63d Congress i 
%d Session j 



j Booumeht 

( No. 264 


BILL 


COMPARATIVE PRINT 

SHOWING THE CHANGES SUGGESTED BY THE MODIFIED AMENDMENT SUBMITTED 
TO THE SENATE BY MR. OWEN, ALSO THE CHANGES SUGGESTED BY 
THE AMENDMENTS INTENDED TO BE PROPOSED 
BY MR. HITCHCOCK TO 


H. R. 7837 

AN ACT TO PROVIDE FOR THE ESTABLISHMENT OF FEDERAL RESERVE BANKS, TO 
FURNISH AN ELASTIC CURRENCY, TO AFFORD MEANS OF REDISCOUNTING COM¬ 
MERCIAL PAPER, TO ESTABLISH A MORE EFFECTIVE SUPERVISION OF 
BANKING IN THE UNITED STATES, AND FOR OTHER PURPOSES 



WASHINGTON 

GOVERNMENT PRINTING OFFICE 
1813 











63d Congress 
2d Session 


SENATE 


J Document 
i No. 264. 


FT 

MEADE 

*.... CURRENCY BILL 

. A4 

1913j - 

Copy 2 


COMPARATIVE PRINT 

SHOWING THE CHANGES SUGGESTED BY THE MODIFIED AMENDMENT SUBMITTED 
TO THE SENATE BY MR, OWEN, ALSO THE CHANGES SUGGESTED BY 
THE AMENDMENTS INTENDED TO BE PROPOSED 
BY MR. HITCHCOCK TO 


H. R. 7837 


AN ACT TO PROVIDE FOR THE ESTABLISHMENT OF FEDERAL RESERVE BANKS, TO 
FURNISH AN ELASTIC CURRENCY, TO AFFORD MEANS OF REDISCOUNTING COM¬ 
MERCIAL PAPER, TO ESTABLISH A MORE EFFECTIVE SUPERVISION OF 
BANKING IN THE UNITED STATES, AND FOR OTFIER PURPOSES 

Iff ■ $ , 1 ^ 3 , • 





WASHINGTON 

GOVERNMENT PRINTING OFFICE 

1913 


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SUBMITTED BY MR. OWEN. 


In the Senate of the United States, December 9 , 1913 . 

Ordered, That there be printed as a Senate document, in document type and in parallel columns, a com¬ 
parative print of the banking and currency bill (H. R. 7837), “An act to provide for the establishment of Fed¬ 
eral reserve banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to 
establish a more effective supervision of banking in the United States, and for other purposes,” showing the 
House bill and the changes suggested by the amendment submitted to the Senate by Mr. Owen; also the 
changes suggested by the amendments intended to be proposed by Mr. Hitchcock, and that 5,000 additional 
copies be printed for the use of the Senate document room, not to exceed the 8500 limit of cost. 

Attest: 

James M. Baker, Secretary. 

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63d CONGRESS, 
1st Session. 


R. 


7837. 



IN THE SENATE OF THE UNITED STATES. 


[The figures indented indicate the page of bill in print showing proposed changes.] 


AN ACT TO PROVIDE FOR THE ESTABLISHMENT OF FEDERAL RESERVE BANKS, TO FURNISH 
AN ELASTIC CURRENCY, TO AFFORD MEANS OF REDISCOUNTING COMMERCIAL PAPER, 
TO ESTABLISH A MORE EFFECTIVE SUPERVISION OF BANKING IN THE UNITED STATES, 
AND FOR OTHER PURPOSES. 


HOUSE BILL. 

Be it enacted by the Senate and 
House of Representatives of the United 
States of America in Congress assem¬ 
bled, That the short title of this Act 
shall be the “Federal Reserve Act.” 


SECTION 1. 

OWEN AMENDMENT. 

Be it enacted by the Senate and 
House of Representatives of the 
United States of America in Con¬ 
gress assembled, That the short title 
of this Act shall be the “Federal Re¬ 
serve Act.” 

Wherever the word “bank” is used 
in this Act, the word shall be held to 
include State bank, banking associa¬ 
tion, and trust company, except where 
national banks or Federal reserve 
banks are specifically referred 
2 to. 

The terms “national bank ” 
and ‘ ‘ national banking association ” 
used in this Act shall be held 
to be synonymous and interchange¬ 
able. The term 11 member bank” 
shall be held to mean any national 
bank, State bank, or bank or trust, 
company which has become a member 
of one of the reserve banks created by 
this Act. The term “board” shall be 
held to mean Federal Reserve Board; 
the term. “ district ” shall be held to 
mean Federal reserve district; the 
term “reserve bank ” shall be held to 
mean Federal reserve bank. 


HITCHCOCK AMENDMENT. 

Be it enacted by the Senate and 
House of Representatives of the 
United S tates of America in Congress 
assembled, That the short title of 
this Act shall be the “Federal Re¬ 
serve Act.” 


The terms “national bank ” and 
“national banking association ” used 
in this Act shall be held to be synony¬ 
mous and interchangeable. The term 
“ member bank ” shall be held to mean 
any national bank, State bank, 
2 or trust company which has 
become a member of one of the 
reserve banks created by this Act. The 
term “board” shall be held to mean 
Federal Reserve Board; the term “ dis¬ 
trict” shall be held to mean Federal re¬ 
serve district; the term “reserve bank” 
shall be held to mean Federal reserve 
bank. 


FEDERAL RESERVE DISTRICTS. 


SECTION 2. 

FEDERAL RESERVE DISTRICTS. 


FEDERAL RESERVE DISTRICTS. 


The Hitchcock amendment proposes to 
strike out all of section 2 of the House bill 
and insert the following: 


Sec. 2. That within ninety days 
after the passage of this Act, or as 
soon thereafter as practicable, the 


Sec. 2. That-w-ithbr-nbaety-days 
As soon thereafter as practicable, 


Sec. 2. That the Federal Reserve 
Board, hereinafter provided for; shall, 
as soon as practicable after their ap- 

3 






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COMPARISON OF CURRENCY BILL. 


4 


SECTION 2—C ontinued 


HOUSE BILL. 


OWEN AMENDMENT. 


Secretary of the Treasury, the Sec¬ 
retary of Agriculture, and the Comp¬ 
troller of the Currency, 


acting as 

“The Reserve Bank Organization 
Committee,” shall designate from 
among the reserve and central re¬ 
serve cities now authorized by law a 
number of such cities to be known 
as Federal reserve cities, and shall 
divide the continental United States 
into districts, each district to con¬ 
tain one of such Federal reserve 
cities: Provided, That the districts 
shall be apportioned with due re¬ 
gard to the convenience and 
2 customary course of business 
of the community and shall 
not necessarily coincide with the 
area of such State or States as may 
be wholly or in part included in any 


given district. The districts thus 
created may be readjusted arid new 
districts may from time to time be 
created by the Federal Reserve 
Board hereinafter established, act¬ 
ing upon a joint application made 
by not less than ten member banks. 
desiring to be organized into a new 

district. The districts thus consti¬ 
tuted shall be known as Federal 
reserve districts and shall be desig¬ 
nated by number according to the 
pleasure of the organization com¬ 
mittee, and no Federal reserve dis¬ 
trict shall be abolished, nor the 
location of a Federal reserve bank 
changed, except upon the applica¬ 
tion of three-fourths of the member 
banks of such district. 


The organization committee shall, 
in accordance with regulations to 
be established by itself, proceed to 
organize in each of the reserve cities 
designated as hereinbefore speci¬ 
fied a Federal reserve bank. Each 
such Federal reserve bank shall in¬ 
clude in its title the name of the 
city in which it is situated, as “Fed¬ 
eral Reserve Bank of Chicago,” and 
so forth. The total number of re- 


the Secretary of the Treasury, the 
Secretary-©#- Agr ieulturey-and-the 

not less than two other members of the 
Federal Reserve Board, hereinafter 
•provided for, to be assigned by the 
President, acting as “The Reserve 
Bank Organization Committee,” 
shall designate 



not less than eight nor more than 
twelve cities to be known as Federal 
reserve cities, and shall divide the 
continental United States, including 
Alaska, into districts, each district 
to contain one, and only one, of such 
Federal reserve cities. The determ i ¬ 
nation of said organization committee 
shall not be subject to review except by 
the Federal Reserve Board wh en 
3 organized: Provided, That 
the districts shall be appor¬ 
tioned with due regard to the con¬ 
venience and customary course of 
business ©f-the- e e mmu nity and shall 
not necessarily eoineide—witb—the 
area-ef-sueh be coterminous with any 
State or States as- m a y be wh elly-ee 
in-part-ieeluded-inr-a ny - given -dis- 
triet. The districts thus created 
may be readjusted and new districts 
may from time to time be created 
by the Federal Reserve Board here- 



i, not 

to exceed twelve -in all. The Such 
districts thus c o n stituted shall be. 
known as Federal reserve districts 
and shall may be designated by 
number 



district. A majority of the organi¬ 
zation committee shall constitute a 
quorum with authority to act. 



©f-the-eit y - in - wh i eh - i t-is-situated^ 
eag© U - and —s©— for th;—The—total 


HITCHCOCK AMENDMENT. 

pointment and confirmation, desig¬ 
nate from among the reserve and cen¬ 
tral reserve cities now established a 
number of such cities to be termed 
Federal reserve cities, and shall divide 
the continental United States into dis¬ 
tricts. each district to embrace one of 
such Federal reserve cities: 
■ r ) Provided, That the districts 
shall be formed with due 
regard to the convenience and custom¬ 
ary co u rse of financial and comm e r¬ 
cial business in each district, and 
need not necessarily coincide with 
State or county boundaries. The dis¬ 
tricts thus established shall be known 
as Federal reserve districts, and each 
of them shall be designate el by the 
name of the Federal reserve city located 
therein. 


The Federal Reserve Board 
shall, as soon as practicable after the 
said districts have been established, 
proceed to organize, conformable to 
the provisions of this act, in each Fed¬ 
eral reserve city designated as afore¬ 
said , a Federal reserve bank, which 
shall be known by the name of the city 
in which it is established, as, for exam¬ 
ple, “ Federal Reserve Bank of Chi¬ 
cago.” Four Federal reserve cities, 




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COMPARISON OF CURRENCY BILL. 


5 


SECTION 2—C o n t i n u e d. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


serve cities designated by the or¬ 
ganization committee shall be not 
less than twelve, and the organiza¬ 
tion committee shall be authorized 
to employ counsel and expert aid, 
to take testimony, to send for per¬ 
sons and papers, to administer 
oaths, and to make such investiga¬ 
tions as may be deemed necessary 
by the said committee for the 
3 purpose of determining the 
reserve cities to be desig¬ 
nated and organizing the reserve 
districts hereinbefore provided. 

Every national bank located with¬ 
in a given district shall be required 
to subscribe to the capital stock of 
the Federal reserve bank of that 
district a sum equal to twenty per 
centum of the capital stock of such 
national bank fully paid in and un¬ 
impaired, one-fourth of such sub¬ 
scription to be paid in cash and one- 
fourth within sixty days after said 
subscription is made. The remain¬ 
der of the subscription or any part 
thereof shall become a liability of 
the member bank, subject to call 
and payment thereof whenever nec¬ 
essary to meet the obligations of the 
Federal reserve bank under such 
terms and in accordance with such 
regulations as the board of directors 
of said Federal reserve bank may 
prescribe: Provided, That no 




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Said organization committee shall 
be authorized to employ counsel and 
expert aid, to take testimony, to send 
-for persons and papers, to administer 
oaths, and to make such investigation 
as may be deemed necessary by 
b the said committee in determin¬ 
ing the reserve districts and in 
determining the cities within such dis¬ 
tricts where such Federal reserve banks 
shall be severally located. The said 
committee shall supervise the organi¬ 
zation, in each o f the cities designated, 
o f a Federal reserve bank, which shall 
include in its title the name of the city 
in which it is situated, as “ Federal 
Reserve Bank o f Chicago .” 

Under regulations to be prescribed 
by the organization committee, every 
national banking association in the 
United States, including the trust 
companies engaged in commercial 
banking within the District of Colum¬ 
bia, is hereby required and every eligi¬ 
ble bank is hereby authorized to signify 
in writing, within sixty days after 
the passage of this act , its acceptance 


and appurtenant to them four Federal 
reserve districts, and no more, shall in 
the first instance be designated and 
established as such by the Federal 
Reserve Board: Provided, That after 
Federal reserve banks have been or¬ 
ganized and in operation for a period 
of two years in said four Federal 
reserve cities, the Federal Reserve 
Board may, in its discretion, from 
time to time, designate not to exceed in 
all eight additional Federal reserve 
cities, with the requisite Federal 
reserve districts appurtenant thereto, 
and for that purpose may alter and 
change the limits and areas of existing 
Federal reserve districts. There shall 
be allotted to every national bank within 
a Federal reserve district, of 
6 the capital stock of the Federal 
reserve bank of such district, 
a sum equal to six per centum of 
the fully paid-up capital stock and 
surplus of such national bank, which 
stock so allotted shall be underwritten 
by said bank and for a period of sixty 
days after allotment be offered for sub¬ 
scription at par to the public at large, 
but no more than one hundred shares 
shall be allowed to be subscribed for or 
held by any person, firm, or corpora¬ 
tion and all of the allotted stock not 
subscribed for and taken by the public 
shall immediately be subscribed for 
and taken by the national bank to 
which the same was in the first in¬ 
stance allotted. The preparation, 
allotment, subscription to, and sale of 
stock shall be under the control of the 
board, which in case of oversubscrip¬ 
tion shall give preference to the 
smaller subscriptions. The national 
banks shall in the first instance act as 
agents of the Federal Reserve Board to 
take subscriptions from the general 
public and receive payment therefor 
which shall be held subject to the order 
of the board. 











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COMPARISON OF CURRENCY BILL. 


6 


SECTION 2—Continued. 

HOUSE BILL. OWEN AMENDMENT. HITCHCOCK AMENDMENT. 

of the terms and provisions hereof. 

When a Federal reserve bank shall 
have been organized, every national 
banking association within that dis¬ 
trict shall be required and every eligi¬ 
ble bank may be permitted to subscribe 
to the capital stock thereof in a sum. 
equal to six per centum of the paid-up 
capital stock and surplus of such bank, 
one-sixth of 

the subscription to be That said stock sub- 

payable on call of the organization scription shall be paid for in gold coin 
committee or of the Federal Reserve or .gold certificates as follows: One- 
Board, one-sixth within three months third at the time of subscription, one- 
and one-sixth within six months there- third within thirty days, and one- 
after, and the remainder of the sub- third within sixty days thereafter, 
scription, or any part thereof, shall 
be subject to call when deemed 
0 necessary by the Federal Re¬ 
serve Board, said payments to 
be in gold or gold certificates. 

The shareholders of every Federal 
reserve banlc shall be held individually 
responsible, equally and ratably, and 
not one for another, for all contracts, 
debts, and engagements of such bank 
to the extent of the amount of their 
subscriptions to such stock at the par 
value thereof in addition to the 
amount subscribed, whether such sub¬ 
scriptions have been paid up in 
whole or in part, under the provisions 
of this Act. 

Any national bank failing to sig¬ 
nify its acceptance of the terms of this 
Act within the sixty days aforesaid 
shall cease to act as a reserve agent, 
upon thirty days’ notice, to be given 
within the discretion of the said or¬ 
ganization committee or of the Fed¬ 
eral Reserve Board. 

Should any national banking asso¬ 
ciation in the United States or trust 
company engaged in commercial bank¬ 
ing in the District of Columbia now 
organized fail within one year after 
the passage of this Act to become a 
member bank under the provisions 
hereinbefore stated, or fail to comply 
with any of the provisions of this Act 
applicable thereto, all of the rights, 
privileges, and . franchises of such 
association granted to it under the 
national-bank Act, or under the pro¬ 
visions of this Act, shall, within the 
discretion of the Federal Reserve 
Board, be thereby forfeited. Any 
noncompliance with or violation oj 
this Act, shall, however, be 
7 determined and adjudged by 
any court of the United States 
of competent jurisdiction in a suit 
brought for that, purpose in the Dis¬ 
trict or Territory in which such bank 
is located, under direction of the 
Federal Reserve Board, by the Comp¬ 
troller of the Currency in his own 




















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COMPARISON OF CURRENCY BILL. 


7 


SECTION 2—C o n t i n u e d 

HOUSE BILL. OWEN AMENDMENT. 

name before the association shall be 
declared dissolved. In cases of such 
noncompliance or violation, other 
than the failure tojfbecome a member 
bank under the provisions of this 
Act, every director who participated 
in or assented to the same shall be 
held liable in his personal or indi¬ 
vidual capacity for all damages which 
said bank, its shareholders, or any 
other person shall have sustained in 
consequence of such violation. 

Such dissolution shall not take 
away or impair any remedy against 
such corporation, its stockholders or 
officers, for any liability or penalty 
which shall have been previously 
incurred. 

Should the subscriptions by banks 
to the stock of said Federal reserve 
banks or any one or more of them be, 
in the judgment of the organization 
committee, insufficient to provide the 
amount of capital required therefor, 
then and in that event the said organi¬ 
zation committee may, under condi¬ 
tions and regulations to be prescribed 
by it, offer to public subscription at 
par such an amount of stock in said 
Federal reserve banks, or any one 
or more of them, as said com- 
8 mittee shall determine, subject 
to the same conditions as to 
payment in and stock liability as 
provided for member banks. 

No individual, copartnership, or 
corporation other than a member 
bank of its district shall be permitted 
to subscribe for or to hold at any time 
more than $10,000 par value of stock 
in any Federal reserve bank. Such 
stock shall be known as public stock 
and may be transferred on the books 
of the Federal reserve bank by the 
chairman of the board of directors of 
such bank. 

Should the total subscriptions by 
banks and the public to the stock of 
said Federal reserve banks, or any 
one or more of them, be, in the judg¬ 
ment of the organization committee, 
insufficient to provide the amount of 
capital required therefor, then and in 
that event the said organization com¬ 
mittee shall allot to the United States 
such an amount of said stock as said 
committee shall determine. Said 
United States stock shall be paid for 
at par out of any money in the 
Treasury not otherwise appropriated, 
and shall be held by the Secretary of 
the Treasury and disposed of for the 
benefit of the United States in such 
manner, at such times, and. at such 
price, not less than par, as the Secre¬ 
tary of the Treasury shall determine. 


HITCHCOCK AMENDMENT. 


‘ The Hitchcock amendment proposes to 
strike out all of section 2 of the House bill. 











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COMPARISON OF CURRENCY BILL. 


8 


s 

HOUSE BILL. 


v 


Fed¬ 
eral reserve bank shall commence 
business with a paid-up and unim¬ 
paired capital less in amount than 
$5,000,000. 


The organization com¬ 
mittee shall have power to appoint 
such assistants and incur such ex¬ 
penses in carrying out the provi¬ 
sions of this Act as it shall deem nec¬ 
essary, and isuch expenses shall be 
payable by the Treasurer of the 
United States upon voucher ap¬ 
proved by the Secretary of the 
Treasury, and the sum of $100,000, 
or so much thereof as may be neces¬ 
sary, is hereby- appropriated, out of 
any moneys in the Treasury not 
otherwise appropriated, for the pay¬ 
ment of such expenses. 


E C T I O N 2—C o n t i n u e < 

OWEN AMENDMENT. 

Stock not held by member banks 
shall not be entitled to voting power 
in the hands of its holders, but the 
voting power thereon shall be vested 
in arid be exercised solely by the class 
C directors of the Federal reserve 
bank in which said stock may 

9 be held, and who shall be des¬ 
ignated as “voting trustees.” 

The voting power on said public 
stock shall be limited to one vote for 
each SI5,000 par value thereoffrac¬ 
tional amounts not to be considered. 
The voting trustees shall exercise the 
same powers as member banks in 
voting for class A and class B 
directors. 

The Federal Reserve Board is 
hereby empowered to adopt and pro¬ 
mulgate rules and regulations gov¬ 
erning the transfers of said 'stock and 
the exercise of the voting power thereon. 

No Federal reserve bank shall com¬ 
mence business with a padd-up-and 
unhnpai^ed subscribed capital less in 
amount than $5,000 ^ 000 <1 $3,000,000. 
The organization of reserve districts 
and Federal reserve cities shall not 
be construed as changing the present 
status of reserve cities and central 
reserve cities, except in so far as this 
Act changes the amount of reserves 
that may be carried with approved 
reserve aqents located therein. 

The 

organization committee shall have 
power to appoint such assistants 
and incur such expenses in carrying 
out the provisions of this Act as 
it shall deem necessary, and such 
expenses shall be payable by the 
Treasurer of the United States upon 
voucher approved by the Secretary 
of the Treasury, and the sum of 
$100,000, or so much thereof as may 
be necessary, is hereby appro- 

10 priated, out of any moneys in 
the Treasury not otherwise 

appropriated, for the payment of 
such expenses. 


HITCHCOCK AMENDMENT. 


The board is hereby empowered to 
appoint such assistants, to subpoena, 
swear, and examine witnesses, to em¬ 
ploy counsel and experts, and to incur 
such expenses as may be necessary for 
establishing, organizing," and putting 
in operation the Federal re- 
7 serve banks and designating 
the Federal reserve cities and 
reserve districts provided for in this 
act, and such expenses shall be paid 
by the Treasurer of the United States 
upon vouchers approved by the Secre¬ 
tary of the Treasury, and the sum of 
SI00,000, or so much thereof as may 
be necessary, is hereby appropriated, 
out of any money in the Treasury not 
otherwise appropriated, for the pay¬ 
ment of such expenses. Five mem¬ 
bers of the reserve board shall consti¬ 
tute a quorum with power to do busi¬ 
ness. 














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COMPARISON OF CURRENCY BILL. 


9 


HOUSE BILL. 

STOCK ISSUES. 


4 Sec. 3. That the capital 

stock of each Federal reserve 
bank shall be divided into shares of 
$100 each. The outstanding capi¬ 
tal stock shall be increased from 
time to time as member banks in¬ 
crease their capital stock or as addi¬ 
tional banks become members, and 
shall be decreased as member banks 
reduce their capital stock or cease 
to be members. Each Federal re¬ 
serve bank may establish branch 
offices under regulations of the Fed¬ 
eral Reserve Board at points within 
the Federal reserve district in which 
it is located: Provided, That the 
total number of such branches shall 
not exceed one for each $500,000 of 
the capital stock of said Federal 
reserve bank. 


FEDERAL RESERVE BANKS. 


Sec. 4. The nat’onal banks in 
each Federal reserve district uniting 
to form the Federal reserve bank 
therein, hereinbefore provided for, 
shall under their seals, make an 
organization certificate, which shall 
specifically state the name of such 
Federal reserve bank so organized, 
the territorial extent of the district 
over which the operations of said 
Federal reserve bank are to be car¬ 
ried on, the city and State in which 
said bank is to be located, the 
amount of capital stock and the 
number of shares into which the 
same is divided, the names and 
places of doing business of each of 
20622—S. Doc. 264, 63-2-2 


SECTION 3. 

OWEN AMENDMENT. 

S TOCK ISS UE S BRANCH OFFICES. 


Sec. 3. 



1 I in_ i L"W« I'All Si /~W 1 —O Q 

t tltj t1tu“T uctouvt IX kj 

F-eftpital 
ir Each 

Federal reserve bank may shall es¬ 
tablish branch offices undcr -regulft- 


a t ^ v 1n i n , it i'* If c n ARfrl vegppup 

r nuTtito W iLlii rti trot i vu 

disferiefe- ln which it i s l eeated '. - P re- 
vided.- 



sfeeck-e f -said-Federftf-reseeve-bftBh 
within the Federal reserve district in 
which it is located and also in the 
district of any Federal reserve hank 
which may have been suspended, such 
branches to be established and con¬ 
ducted at places and under regula¬ 
tions approved by the Federal Re¬ 
serve Board. 


SECTION 4. 

FEDERAL RESERVE BANKS. 


The Owen amendment proposes to strike 
out all of section 4 down to the words 
“Every Federal Reserve Bank,” and insert 
the following: 

12 Sec. J h When the organi¬ 

zation committee shall have 
established Federal reserve districts 
as provided in section two of this 
Act, a certificate shall be filed with 
the Comptroller of the Cwrency 
showing the geographical limits of 
such districts and the Federal re¬ 
serve city designated in each of such 
districts. The Comptroller of the 
Currency shall thereupon cause to 
be forwarded to each national bank 
located, in each district, and to such 
other banks declared to be eligible 
by the organization committee which 
may apply therefor, an application 
blank in form to be approved by 


HITCHCOCK AMENDMENT. 

STOCK ISSUES. 


The Hitchcock amendment p-oposes to 
st ike out all of section 3 of the House bill 
and inse t the following: 

Sec. 3. The capital stock of each 
Federal reserve bank shall be di¬ 
vided into shares of 3100 each, and 
shall be without voting power. The 
Federal Reserve Board shall have 
power to prescribe regulations for 
the transfer of said stock. 
8 With the consent and approval 
of the board, reserve banks 
may establish such branch offices, 
within their respective districts, as 
they deem necessary to conform to the 
convenience and established course of 
business. 


FEDERAL RESERVE BANKS. 


The Hitchcock amendment proposes to 
strike out all of section 4 and insert the 
following: 

Sec. 4- When the Federal Reserve 
Board has established Federal reserve 
districts, as prescribed in section two 
of this Act, the governor or vice gov¬ 
ernor of such board shall, under his 
hand and seal, execute a certificate des¬ 
ignating the territorial limits of such 
districts and the Federal reserve city in 
each district, and shall file such certifi¬ 
cate with the Secretary of the Treasury. 







... • 

















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COMPARISON OF CURRENCY BILL. 


10 


S 

HOUSE BILL. 

the makers of said certificate and 
the number of shares held by 
5 each of them, and the fact 
that the certificate is made 
to enable such banks to avail them¬ 
selves of the advantages of this Act. 


¥ 


The said organization certificate 
shall be acknowledged before a 
judge of some court of record or 
notary public; and shall be, together 
with the acknowledgment thereof, 
authenticated by the seal of such 
court, or notary, transmitted to the 
Comptroller of the Currency, who 
shall file, record, and carefully pre¬ 
serve the same in his office. 

Upon 

the filing of such certificate with the 
Comptroller of the Currency as 
aforesaid, the said Federal reserve 
bank so formed shall become a body 
corporate, and as such, and in the 
name designated in such organiza¬ 
tion certificate, shall have power to 
perform all those acts and to enjoy 


ECTION 4 — Continue 

OWEN AMENDMENT. 

the organization committee, which 
blank shall contain a resolution to 
be adopted by the board of directors 
of each bank executing such appli¬ 
cation, authorizing a subscription 
to the capital stock of the Federal 
reserve bank organizing in that dis¬ 
trict in accordance with the provi¬ 
sions of this Act. 

When the minimum amount of 
capital slock prescribed by this Act 
for the organization of any Federal 
reserve bank shall have been sub¬ 
scribed and allotted the organization 
committee shall designate any five 
banks of those whose applications 
have been received, to execute a cer¬ 
tificate of organization, and there¬ 
upon the banks so designated shall, 
under their seals, make an organi¬ 
zation certificate which shall specifi¬ 
cally state the name of such Fed¬ 
eral reserve bank, the territorial ex¬ 
tent of the district over which the 
operations of such Federal reserve 
bank are to be carried on, the city 
and State in which said bank 
13 is to be located, the amount of 
capital stock and the number 
of shares into which the same is 
divided , the name and place of doing 
business of each bank executing such 
certificate, and of all banks which 
have subscribed to the capital stock 
of such Federal reserve bank and 
the number of shares subscribed by 
each, and the fact that the certificate 
is made to enable those banks exe¬ 
cuting same , and all banks which 
have subscribed or may thereafter 
subscribe to the capital stock of such 
Federal reserve bank, to avail them¬ 
selves of the advantages of this Act. 

The said organization certificate 
shall be acknowledged before a judge 
of some court of record or notary 
public; and shall be, toaether with the 
acknowledgment thereof, authenticated 
by the seal of such court, or notary, 
transmitted to the Comptroller of the 
Currency, who shall file, record and 
carefully preserve the same in his 
office. 

Upon the filing of such certificate 
with the Comptroller of the Currency 
as aforesaid, the said Federal reserve 
bank shall become a body corporate 
and as such, and in the name desig¬ 
nated in such organization certificate, 
shall have power — 

First. To adopt and use a corpo¬ 
rate seal. 


HITCHCOCK AMENDMENT. 


When such certificate has been exe¬ 
cuted and filed, as aforesaid, the board 
shall allot to each and every national 
bank stock in the reserve banks as 
prescribed in section two of this Act, 
and when, conformable to section 
two of this Act, an amount of such 
stock has been subscribed for in any 
Federal reserve district equal to 
$6,000,000, and one-third of 
15 such subscription has been paid 
in, the board shall, by its gov¬ 
ernor or vice governor, under his hand 
and seal, issue a certificate in writing 
specifying the name and location of 
the reserve bank in such district, the 
territorial limits of the district, the 
amount of the capital stock sub¬ 
scribed, and the amount paid in on 
such subscription, and the name and 
amount of stock taken by each sub¬ 
scriber. Such certificate shall be ac¬ 
knowledged before the clerk of a court 
of record, or a notary public, and 
shall be filed with the Secretary of the 
Treasury. 


Upon the filing of such certificate 
with the Secretary of the Treasury as 
aforesaid, the said reserve bank so 
formed shall become a body corporate 
and as such, and in the name desig¬ 
nated in such organization certificate, 
shall have power — 

First. To adopt and use a corpo¬ 
rate seal. 













































































































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COMPARISON OF CURRENCY BILL. 


11 


S 

HOUSE BILL. 

all those privileges and to exercise 
all those powers described in section 
fifty-one hundred and thirty-six, 
Revised Statutes, save in so far as 
the same shall be limited by the pro¬ 
visions of this Act. The Federal 
reserve bank so incorporated shall 
have succession for a period of 
twenty years from its organization, 
unless sooner dissolved by Act of 
Congress. 


Every Federal reserve bank shall 
be conducted under the oversight 
and control of a board of directors, 
whose powers shall be the same as 
those conferred upon the boards of 


ECTION 4—Continue 

OWEN AMENDMENT. 

Second. To have succession for a 
period of twenty years from, its organi¬ 
zation unless it is sooner dissolved by 
an Act of Congress, or unless its 
franchise becomes forfeited by some 
violation of law. 

14 Third. To make contracts. 

Fourth. To sue and be sued, 
complain and defend, in any court of 
law or equity. 

Fifth. To appoint by its board of 
directors, elected as hereinafter pro¬ 
vided, such officers as are not other¬ 
wise provided for in this Act, to define 
their duties, require bonds of them 
and fix the penalty thereof, to dismiss 
such officers or any of them as may be 
appointed by them at pleasure, arid to 
appoint others to fill their places. 

Sixth. To prescribe by its board of 
directors by-laws not inconsistent 
with law, regulating the manner in 
which its general business may be con¬ 
ducted, and the privileges granted to 
it by law may be exercised and en¬ 
joyed. 

Seventh. To exercise by its board 
of directors, or duly authorized officers 
or agents, all powers specifically 
granted by the provisions of this Act 
and such incidental powers as shall 
be necessary to carry on the business 
of banking within the limitations 
prescribed by this Act. 

Eighth. Upon deposit with the 
Treasurer of the United States of any 
bonds of the United States in the man¬ 
ner provided by existing law relating 
to national banks, to receive from the 
Comptroller of the Currency circulat¬ 
ing notes in blank, registered and 
countersigned as provided by law, 
equal in amount to the par value of 
the bonds so deposited, such notes to 
be issued under the same con- 
lb ditions and provisions of law 
' which relate to the issue of cir¬ 
culating notes of national banks se¬ 
cured by bonds of the United States 
bearing the circulating privilege. 

But no Federal reserve bank shall 
transact any business except such as 
is incidental and necessarily pre¬ 
liminary to its organization until it 
has been authorized by the Comp¬ 
troller of the Currency to commence 
business under the provisions of this 
Act. 

Every Federal reserve bank shall 
be conducted under the oversight 
supervision and control of a board 


HITCHCOCK AMENDMENT. 

Second. To have succession for a 
period of twenty years from its organ¬ 
ization unless it is sooner dissolved by 
an Act of Congress, or unless its 
franchise becomes forfeited by some 
violation of law. 

Third. To make contracts. 

Fourth. To sue and be sued, com¬ 
plain and defend, in any court of law 
and equity as fully as natural persons. 

Fifth. To appoint by its board of 
directors, elected as hereinafter pro¬ 
vided, such officers as are not 
16 otherwise provided for in this 
Act, to define their duties, re¬ 
quire bonds of them and fix the 
penalty thereof, to dismiss such offi¬ 
cers or any of them as may be ap¬ 
pointed by them at pleasure, and to 
appoint others to fill their places. 

Sixth. To prescribe by its board of 
directors by-laws not inconsistent 
with law regulating the manner in 
which its general business may be 
conducted and the privileges granted 
to it by law may be exercised and 
enjoyed. 

Seventh. To exercise by its board 
of directors, or duly authorized offi¬ 
cers or agents, all powers specifically 
granted by the provisions of this Act 
and such incidental powers as shall 
be necessary to carry on the business 
of banking within the limitations pre¬ 
scribed by this Act. 


No Federal reserve bank shall 
transact any banking business, ex¬ 
cept such as pertains to the perfection 
of its organization and management, 
until two-thirds of its stock sub¬ 
scribed for has been paid in as pre¬ 
scribed in section two of this Act. 

Every Federal reserve bank shall 
be conducted, managed, and con¬ 
trolled by a board of nine directors, 
five of whom shall be appointed by 
the Federal Reserve Board, and shall 














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COMPARISON OF CURRENCY BILL. 


12 


SECTION 4 — Continue 


HOUSE BILL. 

directors of national hanking asso¬ 
ciations under existing law, not in¬ 
consistent with the "provisions of 
this Act. 


OWEN AMENDMENT. 

tke-beards-e#-diree£ers-ef-»atienal 



Such boards of directors 
shall be constituted and elected as 
hereinafter specified and shall 
6 consist of nine members, hold¬ 
ing office for three years, 
and divided into three classes, desig¬ 
nated as classes A, B, and C. 

Class A shall consist of three 
members, who shall be chosen by 
and be representative of the stock¬ 
holding banks. 

Class B shall consist of three 
members, who shall be representa¬ 
tive of the general public interests 
of the reserve district. 


Class C shall consist of three 
members, who shall be designated 
bv the Federal Reserve Board. 


Directors of class A shall be chosen 
in the following manner: 

It shall be the duty of the chair¬ 
man of the board of directors of the 
Federal reserve bank of the district 
in which each such bank is situated 
to classify the member banks of the 
said district into three general 
groups or divisions. Each such 
group shall contain as nearly as 
may be one-third of the aggregate 
number of said member banks of 
the said district and shall consist, 
as nearly as may be, of banks of 
similar capitalization. The said 
groups shall be designated by num¬ 
ber at the pleasure of the chairman 
of the board of directors of the Fed¬ 
eral reserve bank. 


The hoard of directors shall per¬ 
form the duties usually appertaining 
to the office of directors of hanking as¬ 
sociations and all such duties as are 
prescribed hy law. 

Said hoard shall administer the af¬ 
fairs of said hank fairly and impar¬ 
tially and without discrimination in 
favor of or against any member hank 
or hanks and shall, subject to the pro¬ 
visions of law and the orders of the 
Federal Reserve Board, extend to each 
member hank such discounts, ad¬ 
vancements, and accommodations as 
may he safely and reasonably made 
with due regard for the claims and de¬ 
mands of other member hanks. 

16 Such board of directors 

shall be constituted—and 
eleeted selected as hereinafter speci¬ 
fied and shall consist of nine mem¬ 
bers, holding office for three years, 
and divided into three classes, des¬ 
ignated as classes A, B, and C. 

Class A shall consist of three 

members, who shall be chosen by 
and be representative of the stock- . 
holding banks. 

Class B shall consist of three 

members, who sbaU-be-representa- 

f, rvf~ f~ t~> r\ a. I nn k I ia _i ri fnr tu 

T 3 I V U ”T unvl P CHC ' ttt UU17TTU IHCvl I Uo DIj 

their election shall he actively en¬ 
gaged in their district, respectively, 
in commerce, in agriculture, and in 
.some other pursuit. 

Class C shall consist of three 

members, who shall be designated 
by the Federal Reserve Board. 

No director of class B or of class C 
shall he an officer, director, employee, 
or stockholder of any hank. 

Directors of class A and class B 
shall be chosen in the following 
manner: 

The 


chairman of the board of directors 
of the Federal reserve bank of the 
district in which ea ch -s uc k the bank 
is situated te shall classify the mem¬ 
ber banks of the said district into 
three general groups or divisions. 
Each sued group shall contain as 
nearly as may be one-third of the 
aggregate number of said the mem¬ 
ber banks of the said district and 
shall consist, as nearly as 
17 may be, of banks of similar 
capitalization. The said 
groups shall be designated by num¬ 
ber at-tbe-pleasure-e# hy the chair¬ 
man ef-tbe-beard-i 


d. 

HITCHCOCK AMENDMENT. 

he known as directors “A,” and four 
of whom shall he known as directors 
“B,” and who shall he selected and 
appointed hy the member hanks as 
follows: 












































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COMPARISON OF CURRENCY BILL. 


13 


SECTION 4 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. HITCHCOCK AMENDMENT. 


At a regularly called directors’ 
meeting of each member bank in the 
Federal reserve district aforesaid, 
the board of directois of such mem¬ 
ber bank shall elect by ballot one 
of its own members as a district 
reserve elector and shall certify his 
name to the chairman of the board 
of directors of the Federal 
7 reserve bank of the district. 

The said chairman shall es¬ 
tablish lists of the district reserve 
electors, class A, thus named by 
banks in each of the aforesaid three 
groups and shall transmit one list, 
to each such elector in each group. 


At a regularly called direeters* 
meeting of the hoard of directors of 
each member bank in the Fe d eral 
r ese rve district aferesaid-the-beard 

it shall elect by ballot one of its 
own members as a district reserve 
elector and shall certify his name 
to the chairman of the board of 
directors of the Federal reserve 
bank of the district. The said 
chairman shall establish lists of the 
district reserve electors^—elass- 
thus named by banks in each of the 
aforesaid three groups and shall 
transmit one list to each sneh 
elector in each group. Ever y 



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lilllll ctiUl Uottivl ollltil v33l)itUl IfllTUill Fti 

Fee 



mh-said4ist-te-the-eleeters-ift-eaeh 


seieet-and-eerti f y te-the-said-e ba ir- 

m q n f r n m ft ,in nn n* fn a f h t'o o ■n o 
mctn t r“ril et11ltjiiz*VTttJ vttTC rt/llc* 



reserve-direeterj—elass-A-:—In-ease 
ef-a-tie-vete-the-balleting-shall-een- 



The Hitchcock amendment proposes to 
strike out all of section 4 of the House bill. 


asseeiatiem 



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COMPARISON OF CURRENCY BILL. 


14 


SECTION 4 — Continued 

HOUSE BILL. OWEN AMENDMENT. 


Every elector shall, within fifteen 
days of the receipt of 'the said list, 
select and certify to the said chair¬ 
man from among the names on the 
list pertaining to his group, trans¬ 
mitted to him by the chairman, one 
name, not his own, as representing 
his choice for Federal reserve di¬ 
rector, class A. The name receiv¬ 
ing the greatest number of votes, 
not less than a majority, shall be 
designated by said chairman as 
Federal reserve director for the 
group to which he belongs. In case 
no candidate shall receive a ma¬ 
jority of all votes cast in any group, 
the chairman aforesaid shall estab¬ 
lish an eligible list, consisting of 
the three names receiving the great¬ 
est number of votes on the first 
ballot, and shall transmit said list 
to the electors in each of the groups 
of banks established by him. Each 
elector shall at once select and 
certify to the said chairman from 
among the three persons submitted 
to him his choice tor Federal reserve 
director, class A, and the name re¬ 
ceiving the greatest number of such 
votes shall be declared by the chair¬ 
man as Federal reserve director, 
class A. In case of a tie vote the 
balloting shall continue in the man¬ 
ner hereinbefore prescribed until 
one candidate receives more votes 
than either of the others. 

8 Directors of class B shall 

be chosen by the electors of 
the respective groups at the same 
time and in the same manner pre¬ 
scribed for directors of class A, ex¬ 
cept that they must be selected from 
a list of names furnished, one by 
each member bank, and such names 
shall in no case be those of officers 
or directors of any bank or banking 
association. 


Every elector shall, within fifteen 
days after the receipt of the said list, 
certif y to the chairman his first, sec¬ 
ond, and other choices upon the list, 
upon a preferential ballot, on a form 
furnished by the chairman of the 
board of directors of the Federal re¬ 
serve bank of the district. Each 
elector shall make a cross opposite the 
name of the first, second, and. other 
choices for a director of class A and 
for a director of class B, but shall not 
vote more than one choice for any one 
candidate. 

19 Any candidate having a ma¬ 

jority of all votes cast in the 
column of first choice shall be de¬ 
clared elected. If no candidate have a 
majority of all the votes in the first 
column, then there shall be added 
together the votes cast by the electors 
for such candidates in the secondl 
column to the votes cast for the sev¬ 
eral candidates in the first column. 
If any candidate then have a ma jority 
of the electors voting, by adding 
together the first and second choices, 
he shall be declared elected. If no 
candidate have a majority of electors 
voting when the first and second 
choices shall have been added, then 
the votes cast in the third column for 
other choices shall be added together 
in like manner, and the candidate 
then having the highest number of 
votes shall be declared elected. An 
immediate report of election shall be 
declared. 


They shall not accept 
office as such during the term of then- 
service as directors of the Federal 
reserve bank. They shall be fairly 
representative of the commercial, 
agricultural, or industrial interests 
of their respective districts. The 
Federal Reserve Board shall have 
power at its discretion to remove 
any director of class B in any Fed¬ 
eral reserve bank, if it should appear 
at any timte that such director does 


fico a s s uc h dmdng-tke-tecm-ef-their 



age i e ulfe u r al—or indu strial-interests 
ef-their—r espective d istrietsT—The 

power—at-its-diseretie n - - f e -r emove 
any-direeter - of cl ass- B - i e-any-Fed- 


HITCHCOCK AMENDMENT. 

As soon as practicable after a re¬ 
serve bank has been incorporated as 
above provided, the board shall 

17 notify the member banks in 
said Federal reserve district 

to elect four directors within a certain 
date to be named in the notification. 
Said board shall supply to each mem¬ 
ber bank a blank for the purpose of 
recording the vote of said member 
bank. Each member bank shall vote 
for four “ B” directors upon the 
blank so forwarded, shall certify that 
they are the choice of the board of di¬ 
rectors of said, member bank:, which 
certificate shall be signed by the offi¬ 
cers of said bank and forwarded to 
the board within the time which said 
board shall limit. Said board shall 
canvass the ballots so received from, 
said member banks and forward a 
certificate of the result to each of said 
member banks. The candidate for 
director receiving the largest number 
of votes shall be elected for four years: 
the candidate for director receiving 
the second largest number of votes 
shall hold office for three years; the 
candidate for director receiving the 
third largest number o f votes shall hold 
office for two years; the candidate for 
director receiving the fourth largest 
number of votes shall hold office for one 
year. During each subsequent year, 
the election shall be held in the same 
manner except that each bank shall vote 
for only one director unless in case 
of vacancies, when the number to be 
elected shall be certified by the board 
to each member bank, and in such 
cases a plurality vote shall elect. 

18 No person shall be qualified 
to hold the office of director 

“ A ” or director u B y> while he is an 
officer, director, stockholder, or em¬ 
ployee of any other bank or of any 
trust company, and, no person shall 
be appointed or elected director who is 
not at the time of his appointment or 
election an actual and bona fide resi¬ 
dent of the Federal reserve district 
for which he is appointed or elded. 
The Federal Deserve Board shall 

















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COMPARISON OF CURRENCY BILL. 


15 


s: 

HOUSE BILL. 

not fairly represent the commercial, 
agricultural, or industrial interests 
of his district. 

Three directors belonging to class 
C shall be chosen directly by the 
Federal Reserve Board, and shall be 
residents of the district for which 
they are selected, one of whom shall 
be designated by said board as chan- 
man of the board of directors of the 
Federal reserve bank of the district 
to which he is appointed and shall 
be designated as “Federal reserve 
agent.” He shall be a person of 
tested banking experience; and in 
addition to his duties as chairman 
of the board of directors of the Fed¬ 
eral reserve bank of the district to 
which he is appointed, he shall be 
required to maintain under regula¬ 
tions to be established by the Fed¬ 
eral Reserve Board a local 
9 office of said board, which 
shall be situated on the 
premises of the Federal reserve bank 
of the district. He shall make reg¬ 
ular reports to the Federal Reserve 
Board, and shall act as its official 
representative for the performance 
of the functions conferred upon it by 
this Act. He shall receive an an¬ 
nual compensation to be fixed by 
the Federal Reserve Board and paid 
monthly by the Federal reserve 
bank to which he is designated. 


Directors of Federal reserve banks 
shall receive, in addition to any 
compensation otherwise provided, a 
reasonable allowance for necessary 
expenses in attending meetings of 
their respective boards, which 
amount snail be paid by the re¬ 
spective Federal reserve banks. 
Any compensation that may be 
provided by boards of directors of 
Federal reserve banks for members 
of such boards shall be subject to 
review by the Federal Reserve 
Board. 


CTION 4 —Continued. 


OWEN AMENDMENT. 



inf nnAafa /"v4~ bin rl i o f in t 

IIILUi to UJL iTTTI ttlBUl I"D. 


Three directors belonging to class 
C shall be eh o se n appointed directly 
by the Federal Reserve 

20 Board, and shall be have 
been for at least two years 

residents of the district for which 
they are selected appointed, one of 
whom shall be designated by said 
board as chairman of the board of 
directors of the Federal reserve 
bank of the district to which he is 
appointed and shall be designated 
by said board as “Federal reserve 
agent.” He shall be a person of 
tested banking experience; and in 
addition to his duties as chairman 
of the board of directors of the 
Federal reserve bank of the district 
to which he is appointed, he shall 
be required to maintain under regu¬ 
lations to be established by the 
Federal Reserve Board a local 
office of said board, which shall be 
situated on the premises of the 
Federal reserve bank of the dis¬ 
trict. He shall make regular re¬ 
ports to the Federal Reserve Board, 
and shall act as its official repre¬ 
sentative for the performance of 
the functions conferred upon it by 
this Act. He shall receive an an¬ 
nual compensation to be fixed by 
the Federal Reserve Board and paid 
monthly by the Federal reserve 
bank to which he is designated. 
One of the directors of class C, who 
shall be a person of tested banking 
experience, shall be appointed by 
the Federal Reserve Board as dep¬ 
uty chairman and deputy Federal 
reserve agent to exercise the powers of 
the chairman of the board and Fed¬ 
eral reserve agent in case of the ab¬ 
sence or disability of his principal. 

Directors of Federal reserve banks 
shall receive, in addition to any 
compensation otherwise pro- 

21 vided, a reasonable allowance 
for necessary expenses in at¬ 
tending meetings of their respective 
boards, which amount shall be paid 
by the respective Federal reserve 
banks. Any compensation that 
may be provided by boards of di¬ 
rectors oi Federal reserve banks for 
members of such boards shall be 
subject to review and subsequent 
readjustment at any time by the Fed¬ 
eral Reserve Board. 


HITCHCOCK AMENDMENT. 


designate and appoint one of said 
directors “A” as chairman of the 
board of directors, who shall be known 
as “ Federal reserve agent.” Direc¬ 
tors “A” shall hold their offices for 
four years, except the Federal reserve 
agent, who shall hold his office at the 
pleasure of the board. Of the direc¬ 
tors “ A” first selected one shall hold 
office for one year, one for two years, 
one for three years, and one for the 
full term of four years, as designated 
by the board. Directors “J5” shall 
hold their offices for four years except 
that as to the first election one shall 
be elected for one year, one for two 
years, one for three years, and one 
for four years. 


The salaries of the directors shall 
be fixed by the board, and shall be 
payable from the revenues of the 
Federal reserve bank of which they 
are directors. The board of directors 
shall have authority to fix the salaries 
and wages of all the employees of 
their bank. 




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COMPARISON OF CURRENCY BILL. 


16 


SECTION 4 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


The Reserve Bank Organization 
Committee may, in organizing Fed¬ 
eral reserve banks for the fiist time, 
call such meetings of bank directors 
in the several districts as may be 
necessary to carry out the purposes 
of this Act and may exercise the 
functions herein conferred upon the 
chairman of the board of directors 
of each Federal reserve bank pend¬ 
ing the complete organization of 
such bank. 

At the first meeting of the 
full board of directors of each 
Federal reserve bank after organi¬ 
zation it shall be the duty of 
10 the directors of classes A and 
B and C, respectively, to 
designate one of the membeis of 
each class whose term of office shall 
expire in one year from the first of 
January nearest to date of such 
meeting, one whose term of office 
shall expire at the end of two yeais 
from said date, and one whose term 
of office shall expire at the end of 
three years from said date. I here¬ 
after every director of a Federal 
reserve bank chosen as hereinbefore 
provided shall hold office for a term 
of three years; but the chairman of 
the board of directors of each Fed¬ 
eral reserve bank designated by the 
Federal Reserve Board, as herein¬ 
before described, shall be removable 
at the pleasure of the said board 
without notice, and his successor 
shall hold office during the unex¬ 
pired term of the director in whose 
place he was appointed. Vacancies 
that may occur in the several 
classes of directors of Federal re¬ 
serve banks may be filled in the 
manner provided for the original 
selection of such directors, such 
appointees to hold office for the 
unexpired terms of their prede¬ 
cessors. 


The Reserve Bank Organization 
Committee may, in organizing Fed¬ 
eral reserve banks for the first time, 
call such meetings of bank directors 
in the several districts as may be 
necessary to carry out the purposes 
of this Act, and may exercise the 
functions herein conferred upon the 
chairman of the board of directors 
of each Federal reserve bank pend¬ 
ing the complete organization of 
such bank. 

At the first meeting of the full 
board of directors of each Federal 
reserve bank after organization it 
shall be the duty of the directors of 
classes A and B and C, respectively, 
to designate one of the members of 
each class whose term of office shall 
expire in one year from the first of 
January nearest to date of such 
meeting, one whose term of office 
shall expire at the end of two years 
from said date, and one whose term 
of office shall expire at the end of 
three years from said date. There¬ 
after every director of a Federal re¬ 
serve bank chosen as hereinbefore 
provided shall hold office for 
22 a term of three years-phut-thy 

i ia/J ai' li h L A/:l 1 l-vonl- 

1 vjvUv/I o v_/1 v'vvjll x L't-tv;! ill I UkUvI TL Utllilv 

/I 4; 1 < r 1 > *) t~/1 l> | 1 1\ It r w av u l v A s io 1 * 1 r r* 

“uotvj 1j V Ullt” A* trtttTTrtt tt“c>L I V t? 

T> s \ i»/~l_no_1 > nyni 11 I -. /-> f / \ 4 1 AO./.i’i 1 > r\ f ] 

LfU't 1 tlu 1J v/J tyllf ULl Ui vIV. oh I I U VM j 

fl } > Yl 1 J _!> /-> V Amnvn hi A at_til a xa 1 A ilQlii'A 

O TTctl i ot/ * vTiTivt V cl tilt? <tt7 tJTltS IJl uctottTt; 

of—tb e-said—beard j-witbe«h-netieef 

n -» c 1 o n/mACi a / \ n P ftl j L I ft n III OQ 

fttltt TIiI5 3ttUU“!5kJt7T OTTctii TltTitt UtntJt? 

/Ill V'ljl ri-_t b a nvi v a/ I_ p. / > 1 • 1 > |_ . H i a 

ttttTltfp GTlt? Ttrlw^V tlTTtvVI Cut ill Vi CllU 

/I 1 l'.\A f / > 1» I II It' 1~> t \ D A r\ I AA A_b A \1' il LI il 

tTTTCt?t7t7X—Til \V lltirJC jTTrtt"t? lit?YVVtlT fttj 

pointed. Vacancies that may occui 
in the several classes of directors of 
Federal reserve banks may be filled 
in the manner provided for the 
original selection of such directors, 
such appointees to hold office for 
the unexpired terms of their pred¬ 
ecessors. 


Vacancies that occur in either 
class of directors of reserve hanks may 
he filled in the manner pro- 
19 videdfor the original selection 
of such directors, the men so 
selected to hold office for the unexpired 
terms of their predecessors. 

Upon its own initiative, for cause, 
or upon written complaint under oath 
presented by ten or more member 
hanks charging any director of a re¬ 
serve bank with incompetency, dis¬ 
honesty, or other matter affecting his 
efficiency as a director, the hoard shall 
have the power, after hearing and 
proof and pursuant to a written n otice 
specifying the grounds thereof, to re¬ 
move such director. The accused 
director shall he allowed thiity days 
in which to make defense thereto. 
Pending the hearing the hoard may 
within its discretion suspend the 
accused director. 


















































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. 

































































































% 


















COMPARISON OF CURRENCY BILL. 


17 


HOUSE BILL. 


SECTION 5. 

OWEN AMENDMENT. 


INCREASE AND DECREASE OF CAPI¬ 
TAL. 


STOCK ISSUES; INCREASE AND DE¬ 
CREASE OF CAPITAL. 


Sec 5. That shares of the capital 
stock of Federal reserve banks shall 
not be transferable, nor be hy¬ 
pothecated In case a member 
bank increases its capital, it shall 
thereupon subscribe for an addi¬ 
tional amount of cap : tal stock of 
the Federal reserve bank of its dis¬ 
trict equal to twenty per centum of 
the bank’s own increase of 
11 capital, one-half of said sub¬ 
scription to be paid in cash 
in the manner hereinbefore provided 
for original subscription, and one- 
half to become a liability o the 
member bank according to the 
terms of the original subscription 
A bank applying for stock in a Fed¬ 
eral reserve bank at any time after 
the formation of the latter must 
subscribe for an amount of the capi¬ 
tal of said Federal reserve bank 
equal to twenty per centum of the 
capital stock of said subscribing 
bank, paying therefor its par value 
in accordance with the terms pre¬ 
scribed by section two of this Act. 


When the capital stock of any Fed¬ 
eral reserve bank has been increased 
either on account of the increase of 
capital stock of member banks or on 
account of the increase in the num¬ 
ber of member banks, the board of 
directors shall make and execute a 
certificate to the Comptroller of the 
Currency showing said increase in 
capital, the amount paid in, and by 
whom paid In case a member 
bank reduces its capital stock it 
shall surrender a proportionate 
20622-S. Doc. 264, 63-2—3 


Sec. 5. Th a t-sha r es The capital 
stock of each Federal reserve hank 
shall he divided into shares of SI 00 
each. The outstanding capital stock 
shall he increased from time to time as 
member hanks increase their capital 
stock and surplus or as additional 
hanks become members, and may he 
decreased as member hanks reduce 
their capital stock or surplus or cease 
to he members. 


S hares of the capital 
stock of Federal reserve banks 
owned by member hanks shall not be 
transferable, nor be hypothecated 
hypothecable. In case a member 
bank increases increase its capital 
stock or surplus, it shall thereupon 
subscribe for an additional amount 
of capital stock of the Federal re¬ 
serve bank of its district equal to 
twenty six per centum of the banlds 
own said increase ef-eapital, 
23 one-half of said subscription 
to be paid in-eash in the man¬ 
ner hereinbefore provided for orig¬ 
inal subscription, and one-half to 

Lf> nl-- Ia I n A fnynw nr Inn 

T7ct I1 rV cttvJW i tTTl I^ U LI 1V7 U“ T TiXT? V71 VTTXZ 

original-subscription subject to call 
of the Federal Reserve Board. A 
bank applying for stock in a Federal 
reserve bank at any time after the 
formati on- o f -the4atter' organization 
thereof must subscribe for an amount 
of the capital stock of said the 
Federal reserve bank equal to 
t wenty six per centum of the paid- 
up capital stock and surplus of said 
s u bscribing applicant bank, paying 
therefor its par value in-aeeer dance 


tw-o- of th is-Aet plus one-half of one 
per centum a month from the period 
of the last dividend. When the capi¬ 
tal stock of any Federal reserve 
bank has shall have been increased 
either on account of the increase of 
capital stock of member banks or on 
account of the increase in the num¬ 
ber of member banks, the board of 
directors shall make—and—execute 
cause to be executed a certificate to 
the Comptroller of the Currency 
showing said the increase in capital 
stock, the amount paid in, and by 
whom paid. In case a member 


HITCHCOCK AMENDMENT. 

INCREASE AND - DECRE AS E OF 
CAPITAL. 


The Hitehe ck amendment proposes to 
strike out all of section 5 ..f the House bill 
and insert the following: 

Sec. 5 . That the capital stock in 
the reserve hanks shall he main¬ 
tained as nearly as practicable in an 
amount equal to six' per centum of 
the capital and surplus of the 
member banks in said district, and 
the board is authorized from 
21 time to time to sell to the 
public such additional stock 
in any reserve bank as may be re¬ 
quired to maintain this proportion. 
The price at which said stock shall 
be offered to the public shall be at its 
fair market value, but in no case 
below par. Any bank applying for 
membership in a reserve bank shall 
be required by the board to under¬ 
write, a t the price fixed by the board, 
such an amount of capital stock in 
said reserve bank, equal to six per 
centum of the capital and surplus of 
such applying bank, as may be al¬ 
lotted to it by the board, and to pur¬ 
chase and pay for such portion of said 
allotment as may not be purchased by 
the public, as provided for in this act. 


When the capital stock of any re¬ 
serve bank has been increased, the 
board shall certify the same to the 
Secretary of the Treasury. 




- I 


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COMPARISON OF CURRENCY BILL. 


18 


S 

HOUSE BILL. 

amount of its holdings in the capital 
of said Federal reserve bank, and in 
case a member bank goes into volun¬ 
tary liquidation it shall surrender 
all of its holdings of the capital 
stock of said Federal reserve bank. 
In either case the shares surrendered 
shall be canceled and such member 
bank shall receive in payment 
therefor, under regulations to be 

g rescribed by the Federal Reserve 
oard, a sum equal to its cash paid 
subscriptions on the shares surren¬ 
dered . 


12 Sec. 6. That if any mem¬ 
ber bank shall become in¬ 
solvent and a receiver be appointed, 
the stock held by it in said Federal 
reserve bank shall be canceled and 
the balance, after deducting from 
the amount of its cash paid sub¬ 
scriptions all debts due by such in¬ 
solvent bank to said Federal reserve 
bank, shall be paid to the receiver of 
the insolvent bank. 


Whenever the 
capital stock of a Federal reserve 
bank is reduced, either on account 
of a reduction in capital stock of any 
member bank or of the liquidation 
or insolvency of any such member 
bank, the board of directors shall 
make and execute a certificate to 
the Comptroller of the Currency 
showing such reduction of capital 
stock and the amount repaid to such 
bank. 


ECTION 5 — Continue 

OWEN AMENDMENT. 

bank reduces its capital stock it 
shall surrender a proportionate 
amount of its holdings in the capital 
of said Federal reserve bank, and in 
case a member bank goes into volun¬ 
tary liquidation it shall surrender 
all of its holdings of the capital stock 
of said Federal reserve bank and be 
released from its stoclc subscription 

not previously called. In 
24 either case the shares sur¬ 
rendered shall be canceled 
and such member bank shall receive 
in payment therefor, under regula¬ 
tions to be prescribed by the Federal 
Reserve Board, a sum equal to its 
cash-paid subscriptions on the 
shares surrenderee! and one-half of 
■one per centum a month from the 
period of the last dividend, not to 
exceed the book value thereof, less any 
liability of such member bank to the 
Federal reserve bank. 

SECTION 6. 



by-it-in-said- 

g j ltil j 1 i ft O nn n /{ n ri r f hn Kn l fi nnn 

rrrrccTT octrnrvrx^vT rtttnme UctTctiid?^ 

I I t .P V ClO n ilofllUl' t~,h o a • I \nnt / \ r 

ItrCvT1 lUlll v/I 

i f q n oc) }-« T~V 1 f\ t il h s 'iO l' infl I I r Uli ta 

TcoUTon pxiu ouU3ui TpCTUll3 ttlr uUUtJa 

n bHpu n 1 t ap /~ vy ^ 7 P »— r\o n I /- . ci h n 11 hn - -rv 11 d 
TXuuTcti T uoUT Tv ucttTKyiltralTTT^U p t T“ 


bank If any member bank shall be 
declared insolvent and a receiver ap¬ 
pointed therefor, the stock held byitm 
said Federal reserve bank shall be can¬ 


celed, and all cash paid subscriptions 
on said stock, with one-half of one per 
centum per month from the period of 
last dividend, not to exceed the book 
value thereof, shall be first applied to 
all debts of the insolvent member bank 
to the Federal reserve bank, and the 
balance, if any, shall be paid to the 
receiver of the insolvent bank. When¬ 
ever the capital stock of a Federal 
reserve bank is reduced, either on 
account of a reduction in capital 
stock of any member bank or of the 
liquidation or insolvency of any 
such m e mb er such bank, the board 
of directors shall m ake a n d 
25 execute cause to be executed a 
certificate to the Comptroller 
of the Currency showing such re¬ 
duction of capital stock and the 
amount repaid to such bank. 


d. 

HITCHCOCK AMENDMENT. 


The Hitchcock amendment proposes to 
strike out all of section 6 of the House hill 
and insert the following: 

Sec. 6. That in case the Federal 
Reserve Board shall decide, after two 
years’ operation of the reserve banks 
first established, that one or more addi¬ 
tional banks herein authorized should 
be established it shall make the neces ■ 
sary change in lines of existing dis¬ 
tricts, designate the new reserve city or 
cities, anf notify the member banks 
affected by such change to associate 
themselves with the new reserve bank 
or banks and change the deposit of 
their reserves accordingly. Stock¬ 
holders in previously established re¬ 
serve banks affected by the change shall 
be invited to exchange a portion of 
their stock certificates as indicated by 
the reserve board, and for all stock so 
exchanged the reserve board shall di¬ 
rect the transfer to the new reserve 
bank or banks from the old reserve 
bank or banks of the corresponding 
amount of cash capital in gold. 

If sufficient stock certificates are not 
thus exchanged the reserve board may 
offer to the general public at par stock 
in the newly created district or districts 
to an amount necessary to make up the 
difference. 

As an inducement to make the ex¬ 
change of stock the reserve board may 
direct that the stock of the old reserve 
bank or banks so exchanged shall be 
entitled to payment in cash of its share 
of the accumulated surplus. 








K ■ 

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COMPARISON OF CURRENCY BILL. 


19 


HOUSE BILL. 


SECTION 7. 

OWEN AMENDMENT. HITCHCOCK AMENDMENT. 


DIVISION OF EARNINGS. 


DIVISION OF EARNINGS. 23 DIVISION OF EARNINGS. 


Sec. 7. That after the payment of 
all necessary expenses and taxes of a 
Federal reserve bank, the member 
banks shall be entitled to receive an 
annual dividend of five per centum 
on the paid-in capital stock, which 
dividend shall be cumulative. One- 
half of the net earnings, after the 
aforesaid dividend claims have been 
'fully met, shall be paid into a sur¬ 
plus fund until such fund shall 
amount to twenty per centum of 
the paid-in capital stock of such 
bank, and of the remaining one-half 
sixty per centum shall be paid to 
the United States and forty per 
centum to the member banks in 
the ratio of their average 
13 balances with the Federal re¬ 
serve bank for the preceding 
year. Whenever and so long as the 
surplus fund of a Federal reserve 
bank amounts to twenty per centum 
of the paid-in capital stock and the 
member banks shall have received 
the dividends at the rate of five per 
centum per annum hereinbefore 
provided for, sixty per centum of all 
excess earnings shall be paid to the 
United States and forty per centum 
to the member banks in proportion 
to their annual average balances 
with such Federal reserve bank; 


, all 

earnings derived b} r the United 
States from Federal reserve banks 
shall constitute a sinking fund to be 
held for the reduction of the out¬ 
standing bonded indebtedness of the 
United States, said reduction to be 
accomplished under regulations to 
be prescribed by the Secretary of 
the Treasury. Should a Federal 
reserve bank be dissolved or go into 


/ 1 hi) t, fll tAii th/v rtQ 

UDl.'. I • xuuiu uiillDl mU Ufl y IIIgITC 

e# After all necessary expenses and 
taxes of a .Federal reserve bank 
have been paid or provided for, the 
m e m ber-banks stockholders shall be 
entitled to receive an annual divi¬ 
dend of ftve six per centum on the 
paid-in capital stock, which divi¬ 
dend shall be cumulative. One- 
half of the net earnings, after the 
aforesaid dividend claims have been 
fully met, shall be paid into a sur¬ 
plus fund until such fund shall 
amount to t went y- forty per centum 
of the paid-in capital stock of such 
bank, and of the remaining one- 
half sixt y fifty per centum shall be 
paid to the United States 


br-average-balattees 

w ftwd 
r cCTTTT 


t \ l ■ vi I rpsin iwA I mnr . tvi ad i > t a An T tt 

“Tcvli LovJ > v UiUllv 11111U U11 to TiU r y 

i \ i~\ ~> • _(iD i ifui u / \ T_f i t ■_i~\ n 1 1 1 iii i M intlu-l 

t/tn UtTTTU* till V7 1 t7TTv* T7ct rrt TTlt"cTT7TUrTT 

bave-r 

I . 1 111 u>La>' o n i > Av r inon L \r v - ia a p 

II v_* 1 *_ til IfvT U I *_ I U V itlt.fl I. Ut «, 15IA L 1 \ IJv. I 




a franchise tax, and fifty per 
centum shall be paid to the United 
States, as a trustee for the benefit of 
depositors in failed national banks, 
the money to be kept in and losses from 
failures to be paid from it as a de¬ 
positors' insurance fund under a divi¬ 
sion of the Treasury to be constituted, 
a nd managed under such regulations 
as may be prescribed by the Secretary 
of the Treasury. 

All net earnings 
derived by the United States from 
Federal reserve banks shall eensfci- 

be applied to the reduction of the 
outstanding bonded indebtedness of 
the United Statesj-sabbreduetien-to 
be-aee ompl isbed under regulations 
to be prescribed by the Secretary of 
the Treasury. Should a Federal 
reserve bank be dissolved or go into 


The Hitchcock amendment proposes to 
strike out all of section 7 of the House bill 
and insert the following: 

Sec. 7. That after the payment of 
all necessary expenses and taxes, in¬ 
cluding its share of the expenses of 
the Federal Reserve Board, the stock¬ 
holders of each Federal reserve bank 
shall be entitled to receive an annual 
dividend of five per centum on the 
paid-in capital stock, which dividend 
shall be cumulative. Net earnings 
over and above expenses and the 
aforesaid dividend shall be applied as 
follows: Twenty-five per centum of 
such net earnings to be carried to a 
surplus fund until such fund shall 
amount to twenty per centum of the 
paid-in capital stock of such reserve 
bank, and thirty-seven and one-half 
per centum of said net earnings shall 
be set aside in a Rust fund to be 
known as the depositors' insurance 
fund and shall be used for the pay¬ 
ment of the depositors of insolvent 
member banks under rules and regu¬ 
lations made by the board. When, 
in the judgment of the board, there 
has been accumulated in such de¬ 
positors’ insurance fund a sufficient 
sum fully to insure the payment of 
the depositors of insolvent 
25 member banks, the board shall 
have power to suspend the 
setting aside a nd accumulation of the 
said thirty-seven and one-half per 
centum of such earnings, and there¬ 
after such thirty-seven a nd one-half 
per centum of such earnings shall be 
paid to the United States, except that 
in the event the depositors' insurance 
fund is depleted by the payment of 
depositors of insolvent member banks 
such fund, shall be replenished by 
again setting aside such thirty-seven 
and one-half per centum of the earn¬ 
ings or so much, thereof as, in the 
judgment of the board, may be neces¬ 
sary. The remaining net earnings 
shall be paid to the United States: 
Provided, That the amount so paid 
shall be applied to the purchase, at 
par, vnth accrued interest, of the two 
per centum bonds of the United 
States, said bonds then to be retired; 
or if such bonds can not be so pur¬ 
chased said amount shall be applied 
to the purchase of other interest- 
bearing obligations of the United 












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> 






















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I 4 ill I 




















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. 






































- 

- 


COMPARISON OF CURRENCY BILL. 


20 


SECTION 7— Continued. 


HOUSE BILL. 

liquidation, the surplus fund of said 
bank, after the payment of all debts 
and dividend requirements as here¬ 
inbefore provided for, shall be paid 
to and become the property of the 
United States. 


Every Federal reserve bank in¬ 
corporated under the terms of this 
Act and the capital stock therein 
held by member banks shall be ex¬ 
empt from Federal, State, and local 
taxation, except in respect to taxes 
upon real estate. 


Sec. 8. That any national bank¬ 
ing association heretofore organized 
ma} 1, upon application at any 
14 time within one year after the 
passage of this Act, and with 
the approval of the Comptroller of 
the Currency, be granted, as herein 
provided, all the rights, and be sub¬ 
ject to all the liabilities, of national 
banking associations organized sub¬ 
sequent to the passage of this Act: 
Provided, That such application on 
the part of such associations shall 
be authorized by the consent in 
writing of stockholders owning not 
less than a majority of the capital 
stock of the association. Any na¬ 
tional banking association now or¬ 
ganized which shall not, within one 
ear after the passage of this Act, 
ecome a national banking associa¬ 
tion under the provisions herein¬ 
before stated, or which shall fail to 
comply with any of the provisions 
of this Act applicable thereto, shall 
be dissolved: but such dissolution 
shall not take away or impair any 
remedy against such corporation, its 
stockholders or officers, for any lia¬ 
bility or penalty which shall have 
previously been incurred. 


OWEN AMENDMENT. 

liquidation, the-sn-Hplus-fu m 1 ■ of -said 
ba nk any surplus remaining, after 
the payment of all debts, and divi¬ 
dend requirements as hereinbefore 
provided, fmy and the par value of 
the stock, shall be paid to and be¬ 
come the property of the United 
States and shall be similarly applied. 

Every Federal reserve bank incor- 
dorated under the terms of this Act 
and, the capital stock and surplus 

the income derived therefrom shall be 
exempt from Federal, State, and 
local taxation, except in respect to 
taxes upon real estate. 

SECTION 8. 

The Owen amendment proposes to elimi¬ 
nate this section of the House bill. 


HITCHCOCK AMENDMENT. 

States, which obligations shall there¬ 
upon be retired. 


Every Federal reserve hank 
incorporated under the terms of 
this Act and the capital stock 

the income derived therefrom shall be 
exempt from Federal, State, and 
local taxation, except in respect to 
taxes upon real estate. 


The Hitchcock amendment proposes to 
strike out all of section 8 and insert the 
following: 

Sec. 8 . That within six months 
after a national bank shall have been 
notified by the Federal Reserve Board 
of its allotment of stock under section 
two of this Act, said national bank 
shall hold a meeting of its stock¬ 
holders and decide by a majority vote 
whether it will become a member bank 
under the terms of this Act or whether 
it will give up its charter as a national- 
bank. In case the stockholders of 
said national bank shall decide that 
said national bank shall be¬ 
ll come a member bank, the offi¬ 
cers of said bank, upon a 
blank provided by the board, shall 
forward the formal acceptance by said 
national bank of the terms of this 
Act to the board, properly attested 
before a notary public. In case any 
national bank shall fail to forward 
its acceptance to the board within six 
months from the time said board 
■makes the allotment of stock to said 
bank, it shall be deemed to have de¬ 
clined to become a member bank and 
shall thereupon have six months 
within which to surrender its charter 
and abandon its existence as a na¬ 
tional bank. In any case, however, 
every national bank shall be and is 
required to accept the allotment of 
stock as provided in section two, 
which stock may be freely sold, and 
disposed of as other assets of the bank: 
Provided, however, That any national 
bank acting as a reserve agent in a 
reserve or central reserve city shall be 
required to accept the terms of this 
Act within six months from the date 
of notification of its allotment of stock, 
or, upon failure to do so, shall cease 
to be a reserve agent for national 
banks. 






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— • • 

























COMPARISON OF CURRENCY BILL. 


21 


HOUSE BILL. 

Sec. 9. That any bank or banking 
association incorporated by special 
law of any State or of the United 
States, or organized under the gen¬ 
eral laws of any State or the United 
States, and having an unimpaired 
capital sufficient to entitle it to be¬ 
come a national banking association 
under the provisions of existing 
laws, may, by the consent in writing 
of the shareholders owning not less 
than fifty-one per centum of the 
capital stock of such bank or 
15 banking association, and with 
the approval of the Comp¬ 
troller of the Currency, become a 


national banking association under 
its former name or by any name ap¬ 
proved by the comptroller. 

The 

directors thereof may continue to 
be the directors of the association so 
organized until others are elected or 
appointed in accordance with the 
provisions of the law. When the 
comptroller has given to such bank 
or banking association a certificate 
that the provisions of this Act have 
been complied with, such bank ox- 
banking association, and all its 
stockholders, officers, and employ¬ 
ees, shall have the same powers and 
privileges, and shall be subject to 
the sand duties, Labilities, and regu 
lations, in all respects, as shall have 
been prescribed by this Act or by the 
national banking Act for associa¬ 
tions originally organized as na¬ 
tional banking associations. 


. STATE BANKS AS MEMBERS. 

Sec. 10. That from and after the 
passage of this Act any bank or 
banking association or trust com¬ 
pany incorporated by special law 
of any State, or organized under 
the general laws of any State or the 
United States, may make applica¬ 
tion 


SECTION 9. 

OWEN AMENDMENT. 

Sec. 9 8. T ha t any Any bank 
banking-asseeiatien incorporated by 
special law of any State or of the 
United States, or organized under 
the general laws of any State or of 
the United States, and having an 
unimpaired capital sufficient to 
entitle it to become a national bank¬ 
ing association under the provisions 
of existing laws, may, by the c on¬ 
sent- i n- wr iting vote of the share¬ 
holders owning not less than lifty- 
one per centum of the capital stock 
of such bank or banking 
28 association, and with the 
approval of the Comptroller 
of the Currency, bee om e-a and acting 
through a committee, organize a na¬ 
tional hanking association with any 
name approved hy the said comp¬ 
troller, and transfer its business to 
such national banking association 

eartne-.t pp rov ed by -the-eemptrellee: 
Provided, however, That said acts are 
not in contravention of the State or 
local law. The directors thereof 
may continue to be the directors of 
the association so organized until 
others are elected or appointed in 
accordance with the provisions of 
the law. When the comptroller 
has given to such bank or banking 
association a certificate that the 
provisions of this Act have been 
complied with, such bank or bank¬ 
ing association, and all its stock¬ 
holders, officers, and employees, 
shall have the same powers and 
privileges, and shall be subject to 
the same duties, liabilities, and regu¬ 
lations, in all respects as shall have 
been prescribed by this Act or and 
by the national banking Act for 
associations originally organized as 
national banking associations. 


SECTION 10. 


STATE BANKS AS MEMBERS. 

Sec. 40 9. That-frem—and—after 
the-passage-ef—tbis-Act-any Any 
ba nk or-bankifig-assoeiat ion-er-t+-Hst 
company incorporated by special 
law of any State, or organized under 
the general laws of anv State or of 
the United States, may make appli¬ 
cation to the reserve hank or- 
29 ganization committee, pending 
organization, and thereafter to 


HITCHCOCK AMENDMENT. 

Sec. 9. That, any bank or bank¬ 
ing association incorporated by spe¬ 
cial law of any State or of the 
United States, or organized under 
the general laws of any State or the 
United States, and having an un¬ 
impaired capital sufficient, to entitle 
it to become a national banking 
association under the provisions of 
existing laws, may, by the consent 
in writing of the shareholders own¬ 
ing not less than fifty-one 
28 per centum of the capital 
stock of such bank or bank¬ 
ing association, and with the ap¬ 
proval of the Comptroller of the 
Currency, become a 


national bank¬ 
ing association under its former 
name or by any name approved by 
the comptroller. 

The directors 
thereof may continue to be the 
directors of the association so or¬ 
ganized until others are elected or 
appointed in accordance with the 
provisions of the law. When the 
comptroller has given to such bank 
or banking association a certificate 
that the provisions of this Act have 
been complied with, such bank or 
banking association, and all its 
stockholders, officers, and employ¬ 
ees, shall have the same powers and 
privileges, and shall be subject to 
the same duties, liabilities, and regu¬ 
lations, in all respects, as shall have 
been prescribed by this Act or by 
the national banking Act for asso¬ 
ciations originally organized as 
national banking associations. 


STATE BANKS AS MEMBERS. 

Sec. 10. That from and after the 
passage of this Act any bank or 
banking association or trust com¬ 
pany incorporated by special law 
of any State, or organized under the 
general laws of any State or the 
United States, may make applica- 










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COMPARISON OF CURRENCY BILL. 

SECTION 10 — Continued. 


22 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


to the Federal Reserve Board 
hereinafter created for the right to 
subscribe to the stock of the Fed¬ 
eral reserve bank organized or to 
be organized within the Federal re¬ 
serve district where the applicant is 
located. 


The Federal Reserve 
Board, under such rules and 
16 regulations as it may permit 
such applying bank to be¬ 
come a stockholder in the Federal 
reserve bank of the district in 
which such applying bank is lo¬ 
cated. Whenever the Federal Re¬ 
serve Board shall permit such ap¬ 
plying bank to become a stock¬ 
holder in the Federal reserve bank 
of the district in which the apply¬ 
ing bank is located, stock shall be 
issued and paid for under the rules 
and regulations in this Act provided 
for national banks which become 
stockholders in Federal reserve 
banks. 


It shall be the duty of the Fed¬ 
eral Reserve Board to establish by¬ 
laws for the general government of 
its conduct in acting upon applica¬ 
tions made by the State banks and 
banking associations and trust com¬ 
panies hereinbefore referred to for 
stock ownership in Federal reserve 
banks. Such by-laws shall require 
applying bank not organized un¬ 
der Federal law to comply with the 
reserve requirements and submit to 
the inspection and regulation pro¬ 
vided for in this and other laws re¬ 
lating to national banks. 


No such 

applying bank shall be admitted 
to membership in a Federal reserve 
bank unless it possesses a paid-up 
unimpaired capital sufficient to en¬ 
title it to become a national bank¬ 
ing association in the place where 
it is situated, under the provisions 
of the national banking Act, and 
conforms to the provisions herein 
prescribed for national banking as¬ 
sociations of similar capitalization 
and to the regulations of the Federal 
Reserve Board. 


the Federal Reserve Board horein- 
a f t or -ereated for the right to sub¬ 
scribe to the stock of the Federal 
reserve bank organized or to be 
organized within the Federal re¬ 
serve district where the applicant is 
located. 

The organization commit¬ 
tee or the Federal Reserve Board, un¬ 
der such rules and regulations as it 
may prescribe, subject to the provi¬ 
sions of this section, shall may per¬ 
mit sueh the applying bank to be¬ 
come a stockholder in the Federal 
reserve bank of the district in which 
sueh the applying bank is located. 
Whenever the organization commit¬ 
tee or the Federal Reserve Board 
shall permit sueh the applying bank 
to become a stockholder in the Fed¬ 
eral reserve bank of the district iu 

stock shall ^fre^ issued and paid for 
under the rules and regulations in 
this Act provided for national banks 
which become stockholders in Fed¬ 
eral reserve banks. 

organization committee or the Federal 
Reserve Board to shall establish by¬ 
laws for the general government of 
its conduct in acting upon applica¬ 
tions made by the State banks and 
banking associations and trust com¬ 
panies hereinbefoze-referred-t© for 
stock ownership in Federal reserve 
banks. Such by-laws shall require 
applying banks not organized under 
Federal law to comply with the re¬ 
serve and capital requirements and 
to submit to the i n spe c tion examina¬ 
tion jmd peculatio n - pr o v ided 

lations prescribed by the organization 
committee or by the Federal Reserve 
Board. 

No sue h applying bank 
shall be admitted to membership 
in a Federal reserve bank unless it 
possesses a paid-up unimpaired cap¬ 
ital sufficient to entitle it to become 
a national banking association in the 
place where it is situated, under the 
provisions of the national banking 

' nuns 



capitalization—and--to—the—regukt- 

Any bank becoming a member■ of 
a Federal reserve bank under the 


tion to the Federal Reserve Board 
hereina#ter-ereated-f©r-the-right-t© 
su bscrib e te-the-stoeh to become a. 
member of the Federal reserve bank 
organized or to be organized within 
the Federal reserve district 
29 where the applicant is 
located. 

The Federal Re¬ 
serve Board, under such rules and 
regulations as it may prescribe, sub¬ 
ject to the provisions of this seetion 
Act, shall permit such applying bank 
to become a stoe kh older-in member 
of the Federal reserve bank of the 
district in winch such applying bank 

Reserve—Board—shah—permit—sueh 


holder-in-the-Federal-reserve-bank 

“I Ill*' 


fl 11 H A- 111 f A y II unpu tnn nnl ao _orwl 

Cl TTvI T7it T“ rut TiTTTTV~T U11 v" I tl 1 vjo it 11 v t 

regulations- in-th is-Aet-pr ©vided-for 


in which case stoclc shall be allotted 
to it as provided in this Act. 
It-shall-be- 



m-applieations 

J ft nrl ho n h 
” it IT lit (71111 IV 

ing—assoeiatlons—and—trust—eom- 
panies-hereinbefore-referred-te-loe 
stock-owner sh ip- in-Federal-reserve 



t iiiL'i-\An ti A» .1 ii/l q fi /-vrt 

tJTTty Txlo t / v tl rUll — .Tilt t rt^ttTrttMUll — jittl 

relating—to—national—banksr 


No 

such applying bank shall be ad¬ 
mitted to membership in a Federal 
reserve bank unless it possesses a 
paid-up unimpaired capital 
30 sufficient to entitle it to be¬ 
come a national banking as¬ 
sociation in the place where it is 
situated, under the provisions of the 
national banking Act, and-eo nform s 
to- the p rovis ions-here in-preseribed 

similar—capitalization—and—to—the 

Board and it shall thereafter be re- 



COMPARISON OF CURRENCY BILL. 


23 


SECTION 10 — Continued. 


HOUSE BILL. 


17 If at any time it shall ap¬ 

pear to the Federal Reserve 
Board that a banking association or 
trust company organized under the 
laws of any State or of the United 
States has failed to comply with the 
provisions of this section or the regu¬ 
lations of the Federal Reserve 
Board, it shall be within the power 
of the said board to require such 
banking association or trust com¬ 
pany to surrender its stock in the 
Federal reserve bank in which it 
holds stock upon receiving from 
such Federal reserve bank the cash- 
paid subscriptions to the said stock 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


provisions of this section shall, in 
addition to the regulations and re¬ 
strictions hereinbefore provided, be 
required to conform to the provisions 
of law imposed on the national banks 
respecting the limitation of liability 
which may be incurred by any person, 
tirm, or corporation to such banks, the 
prohibition against making purchase 
of or loans on stock of such banks, 
and the withdrawal or impairment of 
capital, or the payment of unearned 
dividends, and to such rules and regu¬ 
lations as the Federal Reserve Board 
may, in pursuance thereof, prescribe. 

Such banks, and the officers, 
agents, and employees thereof, 
shall also be subject to the provisions 
of and to the penalties prescribed 
by sections fifty-one hundred and 
ninety-eight, fifty-two hundred, fifty- 
two hundred and one, and fifty-two 
hundred and eight, and fifty - 
two hundred, and nine of 
31 the Revised Statutes. The 
member banks shall also be 
required to make reports of the con¬ 
ditions and of the payments of divi¬ 
dends to the comptroller, as provided 
in sections fifty-two hundred and 
eleven and fifty-two hundred and 
twelve of the Revised Statutes, and 
shall be subject to the penalties pre¬ 
scribed by section fifty-two hundred 
and thirteen for the failure to make 
such report. 

If at any time it shall appear to 
the Federal Reserve Board that a 
banking association or trust com¬ 
pany organized under the laws of 
any State or of the United States 
and having become a member bank 
has failed to comply with the pro¬ 
visions of this section or the regula¬ 
tions of the Federal Reserve Board, 
it shall be within the power of the 
said board, after hearing, to require 
such banking association or trust 
company to surrender its stock in 
the Federal reserve bank; in- wh ieh 
it-feelds-steefe upon reeeivi ng - from 
such surrender the Federal reserve 
bank shall pay the cash-paid sub¬ 
scriptions to the said stock ba-ew- 
renfe- f u n ds with interest at the rate of 
one-half of one per centum per month, 
computed from the last dividend, if 
earned, not to exceed the book value 
thereof, less any liability to said 
Federal reserve bank, except the sub¬ 
scription liability not previously 
called, which shall be canceled, 


quired to make the same reports and 
be subject to the same examination 
and supervision as national banking 
associations and subject also to the 
reserve requirements of this Act. 


If at any time it shall appear to 
the Federal Reserve Board that a 



member bank has failed to comply 
with the provisions of this seetien 
Act or the regulations of the Federal 
Reserve Board, it shall be within the 
power of the said board te-require 



o nn q 11 o 1 tp 11 h m I .h fliiaz fl at ca a qa 

fHlvt r51i’lTT W TUTiTT i uitTi T7 > lift \ O U1 “tt“TT 



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I TXT tll“ 

, after due 








COMPARISON OF CURRENCY BILL. 


24 


SECTION 10 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. HITCHCOCK AMENDMENT. 


in current funds, and said Federal 
reserve bank shall upon notice from 
the Federal Reserve Board be re¬ 
quired to suspend said banking as¬ 
sociation or trust company from fur¬ 
ther privileges of membership, and 
shall within thirty days of such no¬ 
tice cancel and retire its stock and 
make payment therefor in the man¬ 
ner herein provided. 


said Federal reserve bank hearing, to suspend or expel the said 
shall, upon notice from the bank from membership. 

Federal Reserve Board, be re¬ 
quired to suspend said bank¬ 
ing association or trust 
32 company from further privi¬ 
leges of membership, and 
shall within thirty days of such 
notice cancel and retire its stock 
and make payment therefor in 
the manner herein provided. 

The The 

Federal Reserve Board may restore 31 Federal Reserve Board may 
membership upon due proof of com- restore membership upon due 

pliance with the conditions imposed proof of compliance with the condi- 
by this section. tion imposed by this Act. 


FEDERAL RESERVE BOARD. 


SECTION 1 1. 

FEDERAL RESERVE BOARD. FEDERAL RESERVE BOARD. 


Sec. 11 . That there shall be cre¬ 
ated a Federal Reserve Board, 
which shall consist of seven mem¬ 
bers, including the Secretary of the 
Treasury, the Secretary of Agricul¬ 
ture, and the Comptroller of the 
Currency, who shall be members ex 
officio, and four members appointed 
by the President of the United 
States, by and with the advice and 
consent of the Senate. In selecting 
the four appointive members of the 
Federal Reserve Board, not 
18 more than one of whom shall 
be selected from any one 
Federal reserve district, the Presi¬ 
dent shall have due regard to a fair 
representation of different geograph¬ 
ical divisions of the country. The 
four members of the Federal Re¬ 
serve Board appointed by the Presi¬ 
dent and confirmed as aforesaid 
shall devote their entire time to the 
business of the Federal Reserve 
Board and shall each receive an an¬ 
nual salary of $10,000, together with 
an allowance for actual necessary 
traveling expenses, and the Comp¬ 
troller of the Currency, as ex officio 
member of said Federal Reserve 
Board, shall, in addition to the sal¬ 
ary now paid him as comptroller, re¬ 
ceive the sum of $5,000 annually for 
his services as a member of said 
board. Of the four members thus 
appointed by the President not more 


The Hitchcock amendment proposes to 
strike out all of section 11 of the House bill 
and insert the following: 


Sec. 44 10. That- - ther e-shall—be 
ereafed-a A Federal Reserve Boarde¬ 
rs hereby created which shall consist 
of seven members, including the 
Secretary of the Treasury, the - S ee- 

shall be m e mb ers a member ex 
officio, and feur six members ap¬ 
pointed by the President of the 
United States, by and with the ad¬ 
vice and consent of the Senate. In 
selecting the four six appointive 
members of the Federal Reserve 
Board, not more than one of whom 
shall be selected from any one Fed¬ 
eral reserve district, the President 
shall have due regard to a fair rep¬ 
resentation of the different geo¬ 
graphical divisions of the country. 
The four six members of the Federal 
Reserve Board appointed by the 
President and confirmed as afore¬ 
said shall devote their entire time 
to the business of the Federal Re¬ 
serve Board and shall each receive an 
annual salary of $10,000, together 
with an—all owanc e—for actual nec¬ 
essary traveling expenses, and—the 

eiaeie- m e m - b er—e4-said~Fed- 
33 era!—Reserve—Beartfi—shalfi 

in-addibien-te-the-salary-new 
paid—hi m a s--€ om ptroiler—-reeerve 


Sec. 11. That the President of the 
United States shall appoint, by and 
with the advice and consent of the 
Senate, a Federal Reserve Board con¬ 
sisting of eight members, in addition 
to whom, the Secretary of the Treasury 
shall be an ex officio member. Of the 
eight members appointed in the first 
instance, the President shall appoint 
one for a term of one year, one for a 
term of two years, one for a term of 
three years, one for a term of four 
years, one for a term of fice years, one 
for a term of six years, one for a term 
of seven years, and one for a term of 
eight years, and thereafter all ap¬ 
pointments shall be made for a term, 
of eight years. Not less than one nor 
more than three of said members shall 
be appointed from any one Federal 
reserve district. Appointments to Jill 
vacancies in the board shall be 
33 for the unexpired term and 
may be made by the President 
when the Senate is not in session, 
which appointments shall expire at 
the end of the next session. In select¬ 
ing members of the reserve board con¬ 
sideration shall be given to experience 
in commerce and banking. The eight 
members of the Federal Reserve Board 
thus appointed by the President shall 
devote their entire time to the work and 
duties of the board and shall not while 
in office be officers, directors, or em¬ 
ployees of any bank or trust company, 






















. 

. 




























' 



















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COMPARISON OF CURRENCY BILL. 


25 


SECTION 11 — Continued. 


HOUSE BILL. 

than two shall be of the same polit¬ 
ical party, and at at least one of 
whom shall be a person experienced 
in banking. One shall be desig¬ 
nated by the President to serve for 
two, one for four, one for six, and 
one for eight years, respectively, 
and thereafter each member so ap¬ 
pointed shall serve for a term of 
eight years unless sooner removed 
for cause by the President. 

Of 

the four persons thus appointed, 
one shall be designated by the Presi¬ 
dent as manager and one as vice 
manager of the Federal Reserve 
Board. The manager of the Fed¬ 
eral Reserve Board, subject to the 
supervision of the Secretary of the 
Treasury and Federal Reserve 
Board, shall be the active execu¬ 
tive officer of the Federal Reserve 
Board. 


OWEN AMENDMENT. 

and they shall be ineligible during 
the time they are in office and for two 
years thereafter to hold any appoint¬ 
ive office or employment under the 
United States or in the District of 
Columbia or any Territory of the 
United States, or of any member 
bank of a reserve bank. 


Of the four 

six members thus appointed by the 

at least eue- of - w - hom fwo^shaS be a 
per s ou persons experienced in bank¬ 
ing or finance. One shall be desig¬ 
nated by the President to serve for 
two one, one for four two, one for 
si* three, and one for ei ght yea rs 
four, one for five, and one for six 
years, r e s pec ti vely ? and thereafter 
each member so appointed shall 
serve for a term of eight six years 
unless sooner removed for cause by 
the President. Of the four six per¬ 
sons thus appointed, one shall be 
designated by the President as man¬ 
ager governor and one as vice mana¬ 
ger governor of the Federal Reserve 
Board. The m a n a g er governor of 
the Federal Reserve Board, subject 
to the its supervision ef-the-Seere- 

executive officer of t h e- F ederahRe- 

The Secretary of the 
Treasury may assign offices in the 
Department of the Treasury for the 
use of the Federal Reserve Board. 
Each member of the Federal Reserve 
Board shall within fifteen days after 
notice of appointment make and sub¬ 
scribe to the oath of office: 


19 The Federal Reserve Board 

shall have power to levy 
semiannually upon the Federal re¬ 
serve banks, in proportion to their 
capital stock, an assessment suffi¬ 
cient to pay its estimated expenses 
for the half year succeeding the 
levying of such assessment, together 
with any deficit carried forward 
from the preceding half year. 


HITCHCOCK AMENDMENT. 

nor hold stock in any such institu¬ 
tion, and they shall each receive a 
salary of $12,000 per year, payable 
monthly out of the Treasury of the 
United States upon the order or war¬ 
rant of the Secretary of the Treasury. 
The President shall designate, other 
than the Secretary of the Treasury, 
one member of said board as governor 
thereof, and one member as vice gov¬ 
ernor thereof who shall act in place of 
the governor during his disability or 
absence. The governor shall be the 
active executive and presiding officer 
of the board. 


The Federal Reserve Board shall 
have power to levy semiannually 
upon the Federal reserve 
34 banks, in proportion to their 
capital stock and surplus, an 
assessment sufficient to pay its es¬ 
timated expenses and salaries of its 
members and employees for the half 
year succeeding the levying of such 
assessment, together with any def¬ 
icit carried forward from the pre¬ 
ceding half year. 


The Secretary of the 
Treasury shall provide the necessary 
office rooms for said board in the 
Treasury Department Building, or 
the board may select quarters else¬ 
where in the city of Washington if 
sufficient office room can not be found 
in said building. The said board shall 
hold its office in the city of Washing¬ 
ton, District of Columbia. The first 
meeting of the board shall be held as 
soon as may be, upon the 
34 call of the Secretary of the 
Treasury , at a time and place 
designated by him. 

The Federal Reserve Board shall 
have power to levy semiannually 
upon the Federal reserve banks, in 
proportion to their capital stock 
ana surplus, an assessment suffi¬ 
cient to pay its estimated expenses 
and salaries for the half year suc¬ 
ceeding the levying of such assess¬ 
ment, together with any defieifc de¬ 
ficiency carried forward from the 
preceding half year. 


20622—S. Doc. 264, 63-2- 











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COMPARISON OF CURRENCY BILL. 


26 


SECTION 11 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


The first meeting of the Federal 
Reserve Board shall be held in 
Washington, District of Columbia, 
as soon as may be after the passage 
of this Act, at a date to be fixed by 
the Reserve Bank Organization 
Committee. The Secretary of the 
Treasury shall be ex officio chair¬ 
man of the Federal Reserve Board. 
No member of the Federal Reserve 
Board shall be an officer or director 
of any bank or banking institution 
or Federal reserve bank nor hold 
stock in any bank or banking insti¬ 
tution; and before entering upon his 
duties as a member of the Federal 
Reserve Board he shall certify under 
oath to the Secretary of the Treas¬ 
ury that he has complied with this 
requirement. Whenever a vacancy 
shall occur, other than by expira¬ 
tion of term, among the four mem¬ 
bers of the Federal Reserve Board 
appointed by the President, as 
above provided, a successor shall 
be appointed by the President, with 
the advice and consent of the Sen¬ 
ate, to fill such vacancy, and when 
appointed shall hold office for the 
unexpired term of the member 
whose place he is selected to fill. 


The Federal Reserve Board shall 
annually make a report of its 
20 fiscal opera tion to the Speaker 

of the House of Repre¬ 
sentatives, who shall cause the 
same to be printed for the infor¬ 
mation of the Congress. 


The first meeting of the Federal 
Reserve Board shall be held in 
Washington, District of Columbia, 
as soon as may be after the passage 
of this Act, at a date to be fixed by 
the Reserve Bank Organization 
Committee. The Secretary of the 
Treasury shall be ex officio chairman 
of the Federal Reserve Board. No 
member of the Federal Reserve 
Board shall be an officer or director 
of any bank, er banking institution, 
trust company , or Federal reserve 
bank nor hold stock in any bank, er 
banking institution, or trust com¬ 
pany, and before entering upon Iris 
duties as a member of the Federal 
Reserve Board he shall certify under 
oath to the Secretary of the Treas¬ 
ury that he has complied with this 
requirement. Whenever a vacancy 
shall occur, other than by expira¬ 
tion of term, among the four six 
members of the Federal Reserve 
Board appointed by the President, 
as above provided, a successor shall 
be appointed by the President, with 
the advice and consent of the Senate, 
to fill such vacancy, and when ap¬ 
pointed he shall hold office for the 
unexpired term of the member whose 
place he is selected to fill. 

35 The President shall have 

power to Jill all vacancies that 
may happen on the Federal Reserve 
Board during the recess of the Senate, 
by granting commissions which shall 
expire at the end of the next session 
of the Senate. 

Nothing in this Act contained shall 
be construed as talcing away any 
powers heretofore vested by lav) in the 
Secretary of the Treasury which re¬ 
late to the supervision, management, 
and control of the Treasury Depart¬ 
ment and bureaus under such depart¬ 
ment, and wherever any power vested 
by this Act in the Federal Reserve 
Board or the Federal reserve agent 
appears to conflict with the powers of 
the Secretary of the Treasury, such 
powers shall be exercised subject to 
the supervision and control of the 
Secretary. 

The Federal Reserve Board shall 
annually make a full report of its 
fiseal operations to the Speaker of 
the House of Representatives, who 
shall cause the same to be printed 
for the information of the Congress. 


I'Na fi rvi AA t ir^/v 

TTIC II I aC lltCCO HI*; 1 



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of—this—Aetj- 


C omm ittee?—The-Seeretiry—ef-the 


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a Q a 1 \ AT-A 1»A^ • 1 / I A i ) -„U_Q1 1 A ft AQ iJA V, Q M fl I L 

rT^ct rf t/Tt LIT 17 V Ttt tTvt ^ rt tTttt: tr tj oo t71 ortftTT 

1 a n_ n i-\i-\a 11 >P/r M . 1 > x- -t It t-\ Di>aq 1/_! A t^ f n Ti; 1 fc t~y 
1/ v_’ lT t / jj\J lllc vj v t f 7 > I'll v, I I Uo Tv. IV 11* V ltii 

4-a-a rn7ipA,ii un - r i A ri‘i.n nf' at t no S ad aIp 
CLlC cttl V Tv.C tlllLl CUIloVJll U U JL UI1 k_L‘ v 

i / \ _U 1 I _.o.n Ii _ n a fl tt’ h aa nn 

t!v/ IT tl emun rctUftiiUTj ctiJU \\ 11UH tip 

l-vAi o t -A/?]. qH 11 _nr>ln a iTi r*_fn t* 

t/VTTTrt'vrvt rytTctTT TTUTltt Ulllt/U l U I 



The Federal Reserve Board shall 
annually make a full report of its 
fiseal operations to the S p e ak o r -ef 
fehe-Heuse-ef R e p resent at ives^-w-ho 
shall-eause-t h e-same- ee-be-pr inted 
fer-tbe-infermatioft-ef-tbe Congress. 











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COMPARISON OF CURRENCY BILL. 


27 


SECTION 11 -Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


Section three hundred and 
twenty-four of the Revised Statutes 
of the United States shall be 
amended so as to read as follows: 


Section three hundred and 
twenty-four of the Revised Statutes 
of the United States shall be 
amended so as to read as follows: 


e f -t h e- T reasury-a-burea u - ch argedy 



aws 

ress-relating-te-tbe 


issue— 



I hi i»i» An/^TT o 

vurTLIIb y 5 a 

dlif j rvo n >-> /-I An th a a n n T /-I i i» a a ! iaji 

viuUTLJ U11UUT”DIIU FLUCTtll UTTUUuivii 


n nf i r\ a» on t 1^ a a n ^ f> i-\ a-P t h a 

tiuTTui' mo UHL v/iiuill UI 

tfl 1 n A /1 n h Q 1 I l \ A A A Cl f 1‘1 I A .1 f A (I f t AAf 

ure invert oTTCCTT T7 v7 i_<V/uoi/i uvvi lu ifcfTvTvC 



There 


shall be in the Department of the 
Treasury a bureau charged with the 
execution of all laws passed by Con¬ 
gress relating to the issue and regula¬ 
tion of national currency secured by 
United States bonds and, under the 
general supervision of the Federal 
Reserve Board, of all Federal reserve 
notes, the chief officer of which bureau 
shall be called the Comptroller of the 
Currency and shall perform his duties 
under the general directions of the 
Secretary of the Treasury.” 


"There shall be in the Department 
of the Treasury a bureau charged, 
except as in this Act otherwise 
provided, with the execution of 
all laws passed by Congress relating 
to the issue and regulation of cur¬ 
rency issued by or through banking 
associations, the chief officer of 
which bureau shall be called the 
Comptroller of the Currency, and 
shall perform his duties under the 
general direction of the Secretary 
of the Treasury, acting as the 
chairman of the Federal Reserve 
Board:” Provided, however, That 
nothing herein contained shall be 
construed to affect any power now 
vested bv law in the Comptroller 
of the Currency or the Secretary 
of the Treasury. 


Section three hundred and twen¬ 
ty-four of the Revised Statutes of 
the United States shall be amended 
so as to read as follows: 


‘ ‘There 

shall be in the Department of the 
Treasury a bureau charged— e - xcopt 

n o in f K iq A p t nt l lDl’V V iqn n vA tr i d a /1 
Til UIITTUu UUIIU l YY T7TV} JJ I UT 

with the execution of all laws passed 
by Congress relating to the issue 
and regulation of national currency 
is s ued secured by ee-thro ugh bank 
i nga sseeiati on s^ United States bonds 
arid, under the general supervision of 
the Federal Reserve Board, of all 
Federal reserve notes, the chief 
officer of which bureau shall be 
called the Comptroller of the Cur¬ 
rency, and shall perform his duties 
under the general direction of the 
Secretary of the Tr 

4a_ UA f l nn flil Ra 
iv I' V ' I\ i m XT\; 


Nothing in 
this Act contained shall be construed 
te-af f eet as talcing away any power 
now powers heretofore vested by law 

or th e Secretary of the Treasury 
which relate to the supervision, man¬ 
agement, and control of the Treasury 
Department and the bureaus under 
such department. 











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COMPARISON OF CURRENCY BILL. 


28 


HOUSE BILL. 

Sec. 12. That the Federal Re¬ 
serve Board hereinbefore estab¬ 
lished shall be authorized and em¬ 
powered : 

(a) To examine at its discretion 
the accounts, books, and affairs of 
each Federal reserve bank and to 
require such statements and reports 
as it may deem necessary. The 
said board shall publish once each 
week a statement showing the con¬ 
dition of each Federal reserve 

bank and a consolidated 
21 statement for all Federal 

reserve banks. Such state¬ 
ments shall show in detail the as¬ 
sets and liabilities of such Federal 
reserve banks, single and com¬ 
bined, and shall furnish full infor¬ 
mation regarding fhe character of 
the lawful money held as reserve 
and the amount, nature, and ma¬ 
turities of the paper owned by 
Federal reserve banks. 

(b) To permit or require, in time 
of emergency, Federal reserve banks 
to rediscount the discounted prime 
paper of other Federal reserve banks, 
ot least five members of the Federal 
Reserve Board being present when 
such action is taken and all present 
consenting to the requirement. The 
exercise of this compulsory redis¬ 
count power by the Federal Reserve 
Board shall be subject to an interest 
charge to the accommodated bank 
of not less than one nor greater than 
three per centum above the higher 
of the rates prevailing in the dis¬ 
tricts immediately affected. 


SECTION 12. 


OWEN AMENDMENT. 


Sec. i2,11. Tbaf-fbe The Federal 
Reserve Board hereinbefore-estab¬ 
lished shall be authorized and em¬ 
powered : 

(a) To examine at its discretion 
the accounts, books, and affairs of 
each Federal reserve bank and of 
each member bank and to require 
such statements and reports as it 
may deem necessary. The said 
board shall publish once each week 
a statement showing the condition 
of each Federal reserve bank and a 
consolidated statement for all Fed¬ 
eral reserve banks. Such 
37 statements shall show hi de¬ 
tail the assets and liabilities 
of sueb the Federal reserve banks, 
single and combined, and shall fur¬ 
nish full information regarding the 
character of the l a wful money held 
as reserve and the amount, nature, 
and maturities of the paper and 
other investments owned or held by 
Federal reserve banks. 


(b) To permit or require^-in-time 
of - em erg en e y -,- Federal reserve banks 
to rediscount the discounted prime 
paper of other Federal reserve 





aU-i 

quiremenf- 


-Tbe—exereise- 


}—ce- 
-e£—this 


eempolsery- 
the-Federal Reser v e - B ear d-shail-be 
subjeet-te-au-iuterest-ebarge-te-tbe 


ene—ner—greater—than— three — per 
ee nt u m— above- -the—higher—of—the 

rates-prevailiug-ift-the-distriets-im- 
mediatelv-atfeeted at rates of interest 
to be fixed each week or oftener by the 
Federal Reserve Board. 


(c) To suspend for a period not 
exceeding thirty days (and to renew 
such suspension for periods not to 
exceed fifteen days) any and every 
reserve requirement specified in this 
act: Provided, That it shall estab¬ 
lish a graduated tax upon the 
amounts by which the reserve re¬ 
quirements of this act may be per¬ 
mitted to fall below the level herein¬ 
after specified, such tax to be 
uniform in its application to 
22 all banks; but said board 


(c) To suspend for a period not 
exceeding thirty days, (and from 
time to time to renew such suspension 
for periods not t o excee d exceeding 
fifteen days), any and-every reserve 
requirement specified in this Act: 
Provided, That it shall establish a 
graduated tax upon the amounts by 
which the reserve requirements of 
this Act may be permitted to fall 
below the level hereinafter speci¬ 
fied, such tax to be uniform in its 
application to all Federal reserve 


HITCHCOCK AMENDMENT. 


36 Sec. 12. That the Federal 
Reserve Board hereinbefore 
established shall be authorized and 
empowered: 

(a) To examine at its discretion 
the accounts, books, and affairs of 
each Federal reserve bank and of 
each member bank and to require 
such statements and reports as it 
may deem necessary. The said 
board shall publish once each week 
a statement showing the condition 
of each Federal reserve bank and a 
consolidated statement for all Fed¬ 
eral reserve banks. Such state¬ 
ments shall show in detail the assets 
and liabilities of such Federal re¬ 
serve banks, single and combined, 
and shall furnish full information 
regarding the amount and character 
of the la wful money held as reserve 
and the amount, nature, and ma¬ 
turities of the paper and other in¬ 
vestments owned or held by Federal 
reserve banks. 


(b) To permit or require, in time 
of emergency, Federal reserve banks 
to rediscount the discounted prime 
commercial paper of other Federal 
reserve banks, at least five six mem¬ 
bers of the Federal Reserve Board 
being present when such action is 
taken and all present consenting to 
the requirement. 



by-tbe-3 

be-sabjeet-te-aft-interesf-ebaege-te 

fban-ene-ner-greater-tban-tb-Fee-per 


media tely affeetedr In such case the 
Federal board shall fix a special re¬ 
discount rate of not more than 
37 three per centum■ in excess of 
the discount rate of the accom¬ 
modated reserve bank. 

(ef-Te-suspend-f er-a-per ied-net-ex- 
eeeding-tbirfy-days-(aftd-4e~re«ew 
sueh-sus p e n s ion — f er-perieds-net-te 
exeeed-Sffeen-days^-any-aHd-every 

Aefe-Pvevided.-Tbat-it-sball-estab- 
Ikb—a—graduated—fax—upon—fbe 
amounts—by-w-bieb-tbe—reserve-re- 
quiremeufs-ef-tbis-Aet-may^e j- p e e- 

inafter— spo eidedy—sueb—tax—te—be 
unif o rm —in—its—application—te—ail 






















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COMPARISON OF CURRENCY BILL. 


29 


SECTION 12 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


shall not suspend the reserve re¬ 
quirements with reference to Fed¬ 
eral reserve notes. 


(d) To supervise and regulate the 
issue and retirement of Federal re¬ 
serve notes and to prescribe the 
form and tenor of such notes. 


(e) To add to the number of cities 
classified as reserve and central re¬ 
serve cities under existing law in 
which national banking associations 
are subject to the reserve require¬ 
ments set forth in section twenty of 
this act; or to reclassify existing 
reserve and central reserve cities 
and to designate the banks therein 
situated as country banks at its 
discretion. 

(f) To suspend the officials of 
Federal reserve banks and, for 
cause stated in writing with oppor¬ 
tunity of hearing, require the re¬ 
moval of said officials for incom¬ 
petency, dereliction of duty, fraud, 
or deceit, such removal to be subject 
to approval by the President of the 
United States. 


(g) To require the writing off of 
doubtful or worthless assets upon 
the books and balance sheets of 
Federal reserve banks. 

(h) To suspend, for cause relating 
to violation of any of the provisions 
of this act, the operations of any 
Federal reserve bank and appoint a 
receiver therefor. 


(i) To perform the duties, func¬ 
tions, or services specified or im¬ 
plied in this act. 


banks and to'member banks, 
38 required to keep the same re- 

serves-H^uf-said—beard-sball- 


—reserve—requtre- 


(d) T e-s upo rvise-aed-regulate-the 
issue-and-retirement-e f-Fe deral-re- 



To 

supervise and regulate through the 
bureau under the charge of the Comp¬ 
troller of the Currency the issue and 
retirement of Federal reserve notes, 
and to prescribe rules and regulations 
under which such notes may be de¬ 
livered by the comptroller to the Fed¬ 
eral reserve agents applying therefor. 

(e) To add to the number of cities 
classified as reserve and central re¬ 
serve cities under existing law in 
which national banking associations 
are- subject to the reserve require¬ 
ments set forth in section twenty of 
this Act; or to reclassify existing re¬ 
serve and central reserve cities and 



eretien or to terminate their designa¬ 
tion as such. 


eause—stated — i n - w riti ng—w ith—ep- 
f—r eqn ire-the 

L» l 

r TTTUvlTi 



of—the—F nited-Srates To suspend or 
remove any officer or director of any 
Federal reserve bank, the cause of such 
removal to be forthwith com- 
39 municated in writing by the 
Federal Reserve Board to the 
removed officer or director and to said 
bank. 


(g) To require the writing off of 
doubtful or worthless assets upon 
the books and balance sheets of Fed¬ 
eral reserve banks. 

(h) To suspend, for cause relating 
to violation of any of the provisions 
of this Act, the operations of any 
Federal reserve bank and ap p oint-a 
reeefver-therefer take possession 
thereof and, administer the same dur¬ 
ing the period of suspension. 

(i) To require bortds of Federal re¬ 
serve agents, perform the duties, 
functions, or services specified or im- 


HITCHCOCK AMENDMENT. 



(d c) To supervise and regulate 
the issue and retirement of Federal 
reserve notes and to prescribe the 
form and tenor of such notes. 


(e d) To add to the number of 
cities classified as reserve and cen¬ 
tral reserve cities under existing 
law in which national banking asso¬ 
ciations are subject to the reserve 
requirements set forth in seefien 
t wcn t y -o f this Act; or to reclassify 
existing reserve and central reserve 
cities and or to 


af-its-diserefien terminate their des¬ 
ignation as such. 



(g e) To require the writing off of 
doubtful or worthless assets upon 
the books and balance sheets of 
Federal reserve banks. 



if) To require bonds of Federal re¬ 
serve agents for the faithful perform¬ 
ance of the duties of their office. 













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COMPARISON OF CURRENCY BILL. 


30 


SECTION 12 — Continued. 


HOUSE BILL. 


23 FEDERAL ADVISORY COUNCIL. 

Sec. 13. There is hereby created 
a Federal Advisory Council, which 
shall consist of as many members 
as there are Federal reserve dis¬ 
tricts. Each Federal reserve bank 
by its board of directors shall annu¬ 
ally select from its own Federal re¬ 
serve district one member of said 
council, who shall receive no com¬ 
pensation for his services, but may 
be reimbursed for actual necessary 
expenses. 


The meetings of said 
advisory council shall be held at 
Washington, District of Columbia, 
at least four times each year, and 
oftener if called by the Federal 
Reserve Board. The council may 
select its own officers and adopt its 
own methods of procedure, and a 
majority of its members shall con¬ 
stitute a quorum for the transaction 
of business. Vacancies in the coun¬ 
cil shall be filled by the respective 
reserve banks, ana members se¬ 
lected to fill vacancies shall serve 
for the unexpired term. 

The Federal Advisory Council 
shall have power (1) to meet and 
confer directly with the Federal 
Reserve Board on general business 
conditions; (2) to make oral or 
written representations concerning 


OWEN AMENDMENT. HITCHCOCK AMENDMENT. 

plied in this Act, and to make all (4)- T e - p erfor m the dut ie^-fe m e- 
rules and regulations necessary to en- tkms^-er-se r v i ees- s p e c i fi e d er-hn- 
able said board effectively to 'perform plied- m - th is- Ae tr 
the same. 

(j) To exercise general supervision 
over said Federal reserve banks. 

(k) To authorize member banks to 
use, as reserves, Federal reserve notes, 
or bank notes based on United States 
bonds, to the extent that said board 
may find necessary. 

(Z) To grant by special permit to 
national banks applying therefor, 
when not in contravention of State 
law, the right to act as trustee, executor, 
administrator, or registrar of stocks 
and bonds under such rules and regu¬ 
lations as the said board may pre¬ 
scribe. 


SECTION 13. 


40 FEDERAL ADVISORY COUNCIL. FEDERAL ADVISORY COUNCIL. 


Sec. 43 12. There is hereby cre¬ 
ated a Federal Advisory Council, 
which shall consist of as many 
members as there are Federal re¬ 
serve districts. Each Federal re¬ 
serve bank by its board of directors 
shall annually select from its own 
Federal reserve district one member 
of said council, who shall receive 


Sec. 13. There is hereby created 
a Federal Advisory Council, which 
shall consist of as many members as 
there are Federal reserve districts. 
Each Federal reserve bank by its 
board of directors shall annually 
select from its own Federal reserve 
district one member of said council, 
who shall receive 



l«_fl pfn n 1 

such compensa¬ 
tion and allowances as may be fixed 
by his board of directors subject to the 
approval of the Federal Reserve 
Board. 


ponses such compensation and allow¬ 
ances as may be fixed by the board of 
directors subject to the approval of the 
Federal Reserve Board. 


The meetings of said ad¬ 
visory council shall be held at Wash¬ 
ington, District of Columbia, at least 
four times each year, and oftener if 
called by the Federal Reserve 
Board. The council may select its 
own officers, and adopt its own 
methods of procedure, and a major¬ 
ity of its members shall constitute 
a quorum for the transaction of 
business. Vacancies in the council 
shall be filled by the respective 
reserve banks, and members selected 
to fill vacancies shall serve for the 
unexpired term. 

The Federal Advisory Council 
shall have power, by itself or through 
its officers, (1) to meet and confer 
directly with the Federal Reserve 
Board on general business condi¬ 
tions; (2) to make oral or written 


The meet¬ 
ings of said advisory council shall 
be held at Washington, District of 
Columbia, at least four times each 
year, and oftener if called by the 
Federal Reserve Board. The 
39 council may select its own 
officers and adopt its own 
methods of procedure, and a ma¬ 
jority of its members shall consti¬ 
tute a quorum for the transaction 
of business. Vacancies in the coun¬ 
cil shall be filled by the respective 
reserve banks, and members selected 
to fill vacancies shall serve for the 
unexpired term. 

The Federal Advisory Council 
shall have power by itself or through 
its officers (1) to meet and confer 
directly with the Federal Reserve 
Board on general business condi¬ 
tions; (2) to make oral or written 









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COMPARISON OF CURRENCY BILL. 


31 


S E 

HOUSE BILL. 

matters within the jurisdiction of 
said board; (3) to call for complete 
information and to make recom¬ 
mendations in regard to discount 
rates, rediscount business, note is¬ 
sues, reserve conditions in the va¬ 
rious districts, the purchase and 
sale of gold or securities by reserve 
banks, open-market operations by 
said banks, and the general affairs 
of the reserve banking system. 


24 REDISCOUNTS. 


Sec. 14. That any Federal reserve 
bank may receive from any member 
bank deposits of current funds in 
lawful money, national bank notes, 
Federal reserve notes, or checks 
and drafts upon solvent banks, pay¬ 
able upon presentation; or, solely 
for exchange purposes, may receive 
from other Federal reserve banks 
deposits of current funds in lawful 
money, national bank notes, or 
checks and drafts upon solvent 
banks, payable upon presentation. 


Upon the indorsement of any 
member bank any Federal reserve 
bank may discount notes and bills 
of exchange arising out of com¬ 
mercial transactions; that is, notes 
and bills of exchange issued or 
drawn for agricultural, industrial, or 
commercial purposes, or the proceeds 
of which have been used, or may 
be used, for such purposes, the Fed¬ 
eral Reserve Board to have the right 
to determine or define the charac¬ 
ter of the paper thus eligible for 
discount, within the meaning of this 
Act; nothing herein contained shall 
be construed to prohibit such notes 
and bills of exchange, secured by 
staple agricultural products, or other 
goods, wares, or merchandise from 
being eligible for such discount; but 
such definition shall not include 
notes or bills issued or drawn for 
the purpose of carrying or trading 
in stocks, bonds, or other invest¬ 
ment securities. Notes and bills 


CTION 13 — Continue 

OWEN AMENDMENT. 

representations concerning matters 
within the jurisdiction of said board; 

(3) to call for co mpl ete infor- 
41 mat ion and to make recom¬ 

mendations in regard to dis¬ 
count rates, rediscount business, 
note issues, reserve conditions in 
the various districts, the purchase 
and sale of gold or securities by 
reserve banks, open-market opera¬ 
tions by said banks, and the general 
affairs of the reserve banking sys¬ 
tem. 


SECTION 14. 

REDIS COUNT S POWERS OF FEDERAL 
RESERVE BANKS. 

Sec. 44 13. That-any Any Fed¬ 
eral reserve bank may receive from 
any of its member bank banks, and 
from the United States, deposits of 
current funds in lawful money, 
national-bank notes, Federal re¬ 
serve notes, or checks and drafts 
upon solvent banks of the Federal 
reserve system, payable upon pres¬ 
entation; or, solely for exchange 
purposes, may receive from other 
Federal reserve banks deposits of 
current funds in lawful money, 
national-bank notes, or checks and 
drafts upon solvent member or other 
Federal reserve banks, payable upon 
presentation. 


Upon the indorsement of any of 
its member bank banks, with a 
waiver of demand notice and protest 
by such bank, any Federal reserve 
bank may discount notes, drafts, 
and bills of exchange arising out of 
actual commercial transactions; that 
is, notes, drafts, and bills of ex¬ 
change issued or drawn for agri¬ 
cultural, industrial, or commercial 
purposes, or the proceeds of which 
have been used, or may are to be 
used, for such purposes, the 
42 Federal Reserve Board to 
have the right to determine 
or define the character of the paper 
thus eligible for discount, within 
the meaning of this Act ; n oth mg 
herein. Nothing in this Act con¬ 
tained shall be construed to pro¬ 
hibit such notes, drafts, and bills of 
exchange, secured by staple agri¬ 
cultural products, or other goods, 
wares, or merchandise from being 
eligible for such discount; but such 


d. 

HITCHCOCK AMENDMENT. 

representations concerning matters 
within the jurisdiction of said board; 
(3) to call for complete information 
and to make recommendations in 
regard to discount rates, rediscount 
business, note issues, reserve con¬ 
ditions in the various districts, the 
purchase and sale of gold or securi¬ 
ties by reserve banks, open-market 
operations by said banks, and the 
general affairs of the reserve bank¬ 
ing system. 


REDISCOUNTS. 


Sec. 14. That any Federal re¬ 
serve bank may receive from any 
member bank and from the United 
States deposits of current funds in 
lawful money, national bank notes, 
Federal reserve notes, ©f and checks 
and drafts upon solvent member 
banks of the Federal reserve system, 
payable upon presentation; ©f and, 
solely for exchange purposes, may 
receive from other Federal reserve 
bank deposits of current 
40 funds in lawful money, na¬ 
tional bank notes, ©f and 
checks and drafts upon solvent 
member or other Federal reserve 
banks, payable upon presentation. 
Reserve banks shall not pay interest 
on deposits. 

Upon the indorsement of any 
member bank with a waiver of de¬ 
mand notice and protest any Federal 
reserve bank may discount notes, 
drafts, and bills of exchange arising 
out of actual commercial transac¬ 
tions; that is, notes, drafts, and 
bills of exchange issued or drawn 
for agricultural, industrial, or com¬ 
mercial purposes, or the proceeds 
of which have been used, or may 
be used, for such purposes, the 
Federal Reserve Board to have the 
right to determine or define the 
character of the paper thus eligible 
for discount, within the meaning 
of this Act; nothing herein con¬ 
tained shall be construed to pro¬ 
hibit such notes, drafts, and bills of 
exchange, secured by staple agri¬ 
cultural products, or other goods, 
wares, or merchandise from being 
eligible for such discount; but such 
definition shall not include notes, 
dra fts, or bills covering merely invest- 











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COMPARISON OF CURRENCY BILL. 


32 


SECTION 14 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


admitted to discount under the 
terms of this paragraph must have 
a maturity of not more than ninety 
days. 


definition shall not include notes, 
drafts, or bills covering merely in¬ 
vestments or issued or drawn for the 
purpose of carrying or trading in 
stocks, bonds, or other investment 
securities, except bonds and notes of 
the Government of the United States. 

Notes, drafts, and bills admitted to 
discount under the terms of this 
paragraph must have a maturity 
at the time of discount of not more 
than ninety clays. 


25 Upon the indorsement of 

any member bank any Fed¬ 
eral reserve bank may discount the 
paper of the classes hereinbefore de¬ 
scribed having a maturity of more 
than ninety and not more than one 
hundred and twenty days, when its 
own cash reserve exceeds thirty- 
three and one-third per cent of its 
total outstanding demand liabilities 
exclusive of its outstanding Federal 
reserve notes by an amount to be 
fixed by the Federal Reserve Board; 
but not more than fifty per cent of 
the total paper so discounted for any 
member bank shall have a maturity 
of more than ninety days. 

Upon the indorsement of any 
member bank any Federal reserve 
bank may discount acceptances of 
such banks which are based on the 
exportation or importation of goods 
and which mature in not more than 
six months and bear the signature 
of at least one member bank in ad¬ 
dition to that of the acceptor. The; 
amount so discounted shall at no 
time exceed one-half the capital 
stock of the bank for which the re¬ 
discounts are made. 



/ j il ftflQAQ K ava 1 33 h n I / \ y n flflfl aai l Lyrw 1 M » A ' 

rtetSSCS lltjTUTTTUUtt/Tt" ulU3uTTt7“u TtttT 

i-tban-niuetv 



se r ve e x eeeds-fchiety-fehree- a n d -ene- 
tbird-per-eent-ef-im-tetal-eutstafid- 
hm- dem and--'. 




baub-sbail-Itav c ft m aturitv-ef-mefe 


43 


Federal reserve bank may discount 
acceptances e f -su e b b anks which are 
based on the expertatieu-ur impor¬ 
tation or exportation or domestic 
shipment of goods and which mature 
i« have a maturity at time of discount 
of not more than six three months, 
and bear-the-siguatuee-of indorsed 
by at least, one member bank iu-addi- 

amount of acceptances so discounted 
shall at no time exceed one-half the 
paid-up capital stock and surplus 
of the bank for which the rediscounts 
are made. • 


The aggregate of such notes and 
bills bearing the signature or in¬ 
dorsement of any one person, com¬ 
pany, firm, or corporation redis¬ 
counted for any one bank shall at 


The aggregate of such notes and 
bills bearing the signature or in¬ 
dorsement of any one person, com¬ 
pany, firm, or corporation redis¬ 
counted for any one bank shall at 


ments or issued or drawn for the 
purpose of carrying or trading in 
stocks, bonds, or other investment 
securities, except bonds and notes of 
the Government of the United States 
and interest-bearing obligations of its 
dependencies the principal and in¬ 
terest of which have been guaranteed 
by the United States. 

Notes and 

bills admitted to discount under 
the terms of this paragraph must 
have a maturity at the time of dis¬ 
count, of not more than ninety one, 
hundred and eighty days: 
41 Provided, however, That not 
more than fifty per centum of 
the paper discounted for any member 
bantc shall have a maturity exceeding 
ninety days and in no case shall any 
member bank have more than $200,- 
000 of rediscounts having a maturity 
longer than ninety days. 



and-notHnere-than-ene-hundred-and 


reserve—exeeeds—th irty-threc- ■ a n d 

/ > i i t n i n /1 i-vr\i» /\4 tfcc t ntn I nilt 

ttrlc tti it tt pci rrttt “I its tutttt tttrr 


rese rve-netes —b y-au-amount-te-be 



serve bank may discount accept¬ 
ances of seeb member banks which 
are based on the exportation or im¬ 
portation of goods and which ma¬ 
ture-in have a maturity at time of 
discount of not more than six months 
and of acceptances based on domestic 
shipments of goods and which have a 
maturity at time of discount of not 
more than four months and bear the 
signature of at least one member 
bank in addition to that of the 
acceptor. The amount so 
42 discounted shall at no time 
exceed one-half the capital 
stock of the bank for which the 
rediscounts are made. 

The aggregate of such notes and 
bills bearing the signature or in¬ 
dorsement of any one person, com¬ 
pany, firm, or corporation redis¬ 
counted for any one bank shall at 





















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COMPARISON OF CURRENCY BILL. 


33 


SECTION 14 — Continued 


HOUSE BILL. 


no time exceed ten per centum of 
the unimpaired capital and surplus 
of said bank; but this restriction 
shall not apply to the discount of 
bills of exchange drawn in good 
faith against actually existing 
values. 

26 Any national bank may, 
at its discretion, accept 
drafts or bills of exchange drawn 
upon it having not more than six 
months sight to run and growing 
out of transactions involving the 
importation or exportation of goods; 
but no bank shall accept such bills 
to an amount equal at any time in 
the aggregate to more than one-half 
the face value of its paid-up and un¬ 
impaired capital. 


Section fifty-two hundred and 
two of the Revised Statutes of the 
United States is hereby amended so 
as to read as follows: No associa¬ 
tion shall at any time be indebted, 
or in any way hable, to an amount 
exceeding the amount of its capital 
stock at such time actually paid in 
and remaining undiminished by 
losses or otherwise, except on ac¬ 
count of demands of the nature fol¬ 
io wdng: 

First. Notes of circulation. 

Second. Moneys deposited with 
or collected by the association. 

Third. Bills of exchange or drafts 
drawn against money actually on 
deposit to the credit of the associa¬ 
tion, or due thereto. 

Fourth. Liabilities to the stock¬ 
holders of the association for divi¬ 
dends and reserve profits. 

Fifth. Liabilities incurred under 
the provisions of sections two, five, 
and fourteen of the Federal reserve 
Act. 


OWEN AMENDMENT. 

no time exceed ten per centum of 
the unimpaired capital and surplus 
of said bank; but this restriction 
shall not apply to the discount of 
bills of exchange drawn in good 
faith against actually existing val¬ 
ues. 

Any national bank may—at-its 
disevefcien^ accept drafts or bills of 
exchange drawn upon it havi ng no t 


and growing out of transactions 
involving the importation, or expor¬ 
tation, or domestic shipment of goods 
having not more than six months 
sight to run ; but no bank shall ac¬ 
cept such bills to an amount equal 
at any time in the aggregate to 
more than one-half the-faee- valuo 
ef its paid-up and— 
capital stock and surplus. 

44 Section fifty-two hundred 
and two of the Revised Stat¬ 
utes of the United States is hereby 
amended so as to read as follows: No 
association shall at any time be in¬ 
debted, or in any way liable, to an 
amount exceeding the amount of its 
capital stock at such time actually 

E aid in and remaining undiminished 
y losses or otherwise, except on 
account of demands of the nature 
following: 

First. Notes of circulation. 
Second. Moneys deposited with 
or collected by the association. 

Third. Bills of exchange or drafts 
drawn against money actually on 
deposit to the credit of the associa¬ 
tion, or due thereto. 

Fourth. Liabilities to the stock¬ 
holders of the association for divi¬ 
dends and reserve profits. 

Fifth. Liabilities incurred under 
the provisions of seefciens-fc wo r five, 

this Act. 

The Federal Reserve Board may 
authorize the reserve bank of the 
district to discount the direct obli¬ 
gations of member banks, secured 
by the pledge and deposit of satis¬ 
factory securities; but in no case 
shall the amount so loaned by a 
Federal reserve bank exceed three- 
fourths of the actual value of the 
securities so pledged. 


HITCHCOCK AMENDMENT. 


no time exceed ten per centum of 
the unimpaired capital and surplus 
of said bank; but this restriction 
shall not apply to the discount of 
bills of exchange drawn in good 
faith against actually existing 
values. 

Any national bank may, at its dis¬ 
cretion, accept drafts or bills of ex¬ 
change drawn upon it having—not 

and growing out of transactions in¬ 
volving the importation or exporta¬ 
tion of goods having not more than 
six months to run or growing out of 
the domestic shipment of goods and 
having not more than four months to 
run ; but no bank shall accept such 
bills to an amount equal at any 
time in the aggregate to more than 
one - ha lf the faee par value of its 
paid-up and unimpaired capital. 

Tv7U lir C 



o - >■-> rl l' o m n ini n o* m u h pi i A/ * L-t-r 

rrTxvT i vJII let TTT ItUluTTTTTrtTkJTTtJU U V 

lowing 1 . 



h aI at t n a n lti f i a u t <> i* Hi vi , 

liUruUI 3 U1 Cue cloovuTCirTUII rur I V I 

deed s- 



- 

The Federal Reserve Board may 
authorize the reserve bank of the dis¬ 
trict to discount the direct obligations 
of member banks, secured by the pledge 
and deposit of satisfactory securities; 
but in no case shall the amount so 
loaned by a reserve bank exceed three- 
fourths of the actual market value of 
the securities so pledged or one-half 
the amount of the paid-up and unim¬ 
paired capital of the member bank. 


20622—S. Doc. 264, 63-2- 





' 








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■ „ 













































COMPARISON OF CURRENCY BILL. 

SECTION 14 — Cont inu e d. 


34 


HOUSE BILL. 


27 OPEN-MARKET OPERATIONS. 

Sec. 15. That any Federal reserve 
bank may, under rules and regula¬ 
tions prescribed by the Federal Re¬ 
serve Board, purchase and sell in 
the open market, either from or to 
domestic or foreign banks, firms, 
corporations, or individuals, prime 
bankers’ bills, and bills of exchange 
of the kinds and maturities by this 
Act made eligible for rediscount, 
and cable transfers. 


Every Federal reserve bank shall 
have power (a) to deal in gold coin 
and bullion both at home and 
abroad, to make loans thereon, 
and to contract for loans of gold 
coin or bullion, giving therefor, 
when necessary, acceptable security, 
including the hypothecation of 


OWEN AMENDMENT. 

The rediscount by any Federal 
reserve banlc of any bills receivable 
and of domestic and foreign 
45 bills of exchange and accept¬ 
ances shall be subject to such 
restrictions, limitations, and regu¬ 
lations as may be imposed by the 
Federal Reserve Board. 


SECTION 15. 

OPEN-MARKET OPERATIONS. 

Sec. }& 14■ Tha t - any Any Fed¬ 
eral reserve bank may, under rules 
and regulations prescribed by the 
Federal Reserve Board, purchase 
and sell in the open market, at 
home or abroad, either from or to 
domestic or foreign banks, firms, 
corporations, or individuals, prime 
cable transfers and bankers’ bills 
acceptances and bills of exchange of 
the kinds and maturities by this 
Act made eligible for rediscount^ 

the indorsement of a member banlc. 

Every Federal reserve bank shall 
have power: (a) to deal in gold coin 
and bullion both at home and or 
abroad, to make loans thereon, ex¬ 
change Federal reserve notes for gold, 
gold coin, or gold certificates, and to 
contract for loans of gold coin or 
bullion, giving therefor, when nec¬ 
essary, acceptable security, includ¬ 
ing the hypothecation of United 
States bonds or other securities which 
Federal reserve banhs are authorized 


HITCHCOCK AMENDMENT. 

The rediscount by any Federal re¬ 
serve bank of any bills receivable and 
of domestic and foreign bills of ex¬ 
change shall be subject to such regula¬ 
tions as may be imposed by the board . 


The discount provisions of this Act 
shall be equitably extended to all of its 
member banks by each reserve bank 
upon equal terms, and each member 
bank shall be entitled as a matter of 
right to the rediscount of eligible pa¬ 
per to the full amount of its capital 
stock upon the lowest current 
44 rate of discount, and no mem¬ 
ber bank shall be permitted to 
discount an amount of paper exceed¬ 
ing the amount of its capital stock 
except upon payment of a higher rate 
of discount, the increase in rate of 
discount to be one per centum for 
an additional fifty per centum of dis¬ 
counts or part thereof and two per 
centum for all in excess. In no case 
shall a Federal reserve bank discount 
paper for a member bank in excess of 
twice the amount of its capital stock 
without special authority by the board. 


OPEN-MARKET OPERATIONS. 

Sec. 15. That—any Any Federal 
reserve bank may, under rules and 
regulations prescribed by the Fed¬ 
eral Reserve Board, purchase and 
sell in the open market, either from 
or to domestic or foreign banks, 
firms, corporations, or individuals, 
prime bankers’ bills, and bills of 
exchange of the kinds and maturities 
by this Act made eligible for redis¬ 
count, and cable transfers. 


Every Federal reserve bank shall 
have power (a) to deal in gold coin 
and million both at home and 
abroad, to make loans thereon, and 
to contract for loans of gold coin or 
bullion, giving therefor, when neces¬ 
sary, acceptable security, including 
the hypothecation of interest-bear¬ 
ing obligations of the United States 


' 

. 

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. 















































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• 









. 











’ 




COMPARISON OF CURRENCY BILL. 


35 


SECTION 15 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


United States bonds; (b) to invest 
in Unite d States bonds, and bonds 
issued by any State, county, dis¬ 
trict, or municipality; 


(c) to pur¬ 
chase from member banks and to 
sell, with or without its indorse¬ 
ment, bills of exchange arising out 
of commercial transactions, as here¬ 
inbefore defined, payable in for¬ 
eign countries; but such bills of 
exchange mut have not exceeding 
ninety days to run and must bear 
the signature of two or more re¬ 
sponsible parties, of which the last 
shall be that of a member bank; 

(d) to establish each week, or as 
much oftener as required, subject 
to review and determination of the 
Federal Reserve Board, a rate of 
discount to be charged by such 
bank for each class of paper, which 
shall be fixed with a view of accom¬ 
modating the commerce of the 
country; and 

(e) with the 
28 consent of the Federal Re¬ 
serve Board, to open and 
maintain banking accounts in for¬ 
eign countries and establish agen¬ 
cies in such countries wheresoever 
it may deem best for the purpose 
of purchasing, selling, and collect¬ 
ing foreign bills of exchange, and to 
buy and sell with or without its 
indorsement, through such corre¬ 
spondents or agencies, prime for¬ 
eign bills of exchange arising out of 
commercial transactions which have 
not exceeding ninety days to run 
and which bear the signature of 
two or more responsible parties. 


to hold; (b) to invesfe-in buy and sell, 
at home or abroad, bonds and notes of 
the United States be n ds, and bonds 
iss ued by any St afe^-ee unty^ di s- 

tr iefy or mu nicipality bills, notes, 
revenue bonds, and warrants 
46 with a maturity from date of 
'purchase of not exceeding six 
months, issued in anticipation of the 
collection of taxes or in anticipation 
of the receipt of assured revenues by 
any State, county, district, political 
subdivision, or municipality in the 
continental United States, such pur¬ 
chases to be made in accordance with 
rules and regulations prescribed by 
the Federal Reserve Board: 


(c) to 

purchase from member banks and 
to sell, with or without its indorse¬ 
ment, bills of exchange arising out 
of commercial transactions, as here¬ 
inbefore defined, p ayable in f oreign 

/-> s-\ n b tr* l Af ■ hnf Cni/-»h lx i 1 In A-v/il-^n 

“UUTIDT 1 V_U ^ UUU IJUC-U KJ IMo Ui vAV/1 IclII V 

rv-i limb l->n Y-n Tint av,-. aat! in a' i> i -»~t /-> f _t t 

muar irre v vj no u uauloujuv utiiuct 

/Ifi Trn tn >» •»-!-»-> fn-irl mn n t hnn f hn n ia< 
ui«i y o CU T un uixiu 11 luo u uvuu TJTTU 


(d) to es- 

oftene r -as- r e q ui redfrom time to time, 
subject to review and determina¬ 
tion of the Federal Reserve Board, 
a r a t e rates of discount to be charged 
by sueb the Federal reserve bank for 
each class of paper, which shall be 
fixed with a view of accommodating 
the commerce of-the-country and 
business; and (e) to establish ac¬ 
counts with other Federal reserve 
banks for exchange purposes and, 
with the consent oi tne Federal 
Reserve Board, to open and main¬ 
tain banking accounts in foreign 
countries, appoint correspondents, 
and establish agencies in such coun¬ 
tries wheresoever it may deem best 
for the purpose of purchasing, sell¬ 
ing, and collecting foreign 
47 bills of exchange, and to buy 
and sell with or without its 
indorsement, through such corre¬ 
spondents or agencies, prime for - 
eigu bills of exchange arising out of 
actual commercial transactions 
which have not exceeding more 
than ninety days to run and which 
bear the signature of two or more 
responsible parties. 


HA D n • 
T7t7tTtti3, 



municipality (b) to buy and sell in¬ 
terest-bearing obligations of the United 
States and of its dependencies 
45 when payment of principal 
and interest is guaranteed by 
the United States, and bonds or 
warrants of any State, county, or 
municipality, or short-time interest- 
bearing obligations issued by foreign 
governments, with a maturity from 
date of purchase of not exceeding one 
year, such purchases to be made in 
accordance with rules and regulations 
prescribed by the Federal Reserve 
Board ; (c) to purchase from a mem¬ 
ber b a nk s bank and to sell, with or 
without its own indorsement, bills 
of exchange arising out of commer¬ 
cial transactions, as hereinbefore 



establish each week, or as ■ much 
oftene r-a s- r eq u ired publicly from 
time to time, subject to review and 
determination of the Federal Re¬ 
serve Board, a rate of discount to be 
charged by such bank for each class 
of paper, which shall be fixed with 
a view of accommodating the com¬ 
merce of the country and promoting 
stability in business; and (e) estab¬ 
lish accounts with other reserve banks 
and with the consent of the Federal 
Reserve Board, to open and main¬ 
tain banking accounts in foreign 
countries and establish agencies in 
such, countries wheresoever it may 
deem best for the purpose of pur¬ 
chasing, selling, and collecting for¬ 
eign bills of exchange, letters of 
credit, and travelers’ checks, and to 
buy and sell with or without its in¬ 
dorsement, through such 
46 correspondents or agencies, 
pr ime f o r eign bills of ex¬ 
change arising out of commercial 
transactions which have not ex¬ 
ceeding ninety days to run and 
which bear the signature of two or 
more responsible parties. 









' ■ 

' 




X • • 

. 


; n> 


V 

i* 1 h 


















COMPARISON OF CURRENCY BILL. 


36 


HOUSE BILL. 


SECTION 16. 

OWEN AMENDMENT. HITCHCOCK AMENDMENT. 


GOVERNMENT DEPOSITS. 


GOVERNMENT DEPOSITS. 


GOVERNMENT DEPOSITS. 


Sec. 16. That all moneys now 
held in the general fund of the 
Treasury except the five per centum 
fund for the redemption of outstand¬ 
ing national-bank notes shall, upon 
the direction of the Secretary of the 
Treasury, within twelve months 
after the passage of this Act, be 
deposited in Federal reserve banks, 
which banks shall act as fiscal agents 
of the United States; and thereafter 
the revenues of the Government 
shall be regularly deposited in such 
banks, and disbursements shall be 
made by checks drawn against such 
deposits. 


The Secretary of the Treasury 
shall, subject to the approval of the 
Federal Reserve Board, from time 
to time, apportion the funds of the 
Government among the said Federal 
reserve banks, distributing them, as 
far as practicable, equitably 
between different sections, and 
may, at their joint discretion, charge 
interest thereon and fix, from 
29 month to month, a rate 
which shall be regularly paid 
by the banks holding such deposits: 
Provided, That no Federal reserve 
bank shall pay interest upon any 
deposits except those of the United 
States. 


No Federal reserve bank shall 
receive or credit deposits except 
from the Government of the United 
States, its own member banks, and, 
to the extent permitted by this Act, 


Sec. U 15. That-all The moneys 
new- held in the general fund of the 
Treasury, except the five per centum 
fund for the redemption of out¬ 
standing national-bank notes and 
the funds provided in this Act for 
the redemption of Federal reserve 
notes shall may, upon the direction 
of the Secretary of the Treasury, 

sag e ■ of thi s A et$- be deposited in 
Federal reserve banks, which banks 
shall, when required by the Secretary 
of the Treasury, shall act as fiscal 
agents of the United States; and 
thereafter the revenues of the Gov¬ 
ernment or any part thereof shall 
may be re g u l arly deposited in such 
banks, and disbursements shall may 
be made by checks drawn against 
such deposits. 

No public funds of the Philippine 
Islands, or of the postal savings, or 
any Government funds, shall be de¬ 
posited in the continental United 
States in any banh not belonging to 
the system established by this Act: 
Provided, however, That nothing in 
this Act shall be construed to deny . 
the right of the Secretary of the 
Treasury to use member banks as 

depositories. 

' I' i’n > i L’ii r> h n 1 1 _L' nkir\/)f f 

a j III \ o ITcTTT^ rTTTrTJ U UU 

f-C /\>1 y» /-f t p/\m t miA f ry f 1 mi r\ n i-\ v\^\ »» 
TTvaTtlj I l vTTTX v iinvy Cvy tXT7T7v7 i 

a mong - t he -said—Federal—reserve 


Sec. 16. That all moneys now 
held in the general fund of the 
Treasury except the five percen- 
tum fund for the redemption of 
outstanding national-bank notes 
and the funds provided in this Act 
for the redemption of Federal reserve 
notes shall, upon the direction of 
the Secretary of the Treasury, 
withi n ' twelve —mo n t h s—a fter - the 

passage-o f -this Acty be deposited in 
Federal reserve banks, which banks 
shall act as fiscal agents of the 
United States; and thereafter the 
revenues of the Government shall 
be regularly deposited in such 
banks, and disbursements shall be 
made by checks drawn against such 
deposits. 



larly—pah 
s uch d e p o s it s: ' Provided, -That—no 

l p AC p w p_hq nlr olaa. 1 I n ftv- i n 

x.' vJO”rcCT Tuoc i v c Ucrnit onczirwcc y ill 


The Secretary of the Treasury 
shall, subject to the approval of the 
Federal Reserve Board, from time 
to time, apportion the fund s of 
the Government deposits among the 
said Federal reserve banks, dis- 
in proportion to 
their cajntal stock as far as practica- 

—interest t i o ns, and - m ay^-at-their joint dis 

aiia I i An V I TD i pf i Dl'DQ C linDVDATl n pH 

““Cttni^“riitrj|;trTixc“TCoO ollUTUvli ctllTJ 

■w h i eh —shaii—be—regularly-pai d - by 





: Provided, That for the purposes of 
collection and transfer only the Sec¬ 
retary of the Treasury may designate 
national banks as Government depos¬ 
itories. 











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37 


COMPARISON OF CURRENCY BILL. 

SECTION 16 — Continued. 


HOUSE BILL. 

from other Federal reserve banks. 
All domestic transactions of the 
Federal reserve banks involving 
loans made by such banks, redis¬ 
count operations or the creation of 
deposit accounts shall be confined to 
the Government and the depositing 
and Federal reserve banks, with the 
exception of the purchase or sale of 
Government or State securities or 
of gold coin or bullion. 


NOTE ISSUES. 

Sec. 17. That Federal reserve 
notes, to be issued at the discretion 
of the Federal Reserve Board for 
the purpose of making advances to 
Federal reserve banks as hereinafter 
set forth and for no other purpose, 
are hereby authorized. The said 
notes shall be obligations of the 
United States and shall be receiva¬ 
ble for all taxes, customs, and other 
ublic dues. They shall be re- 
eemed in gold or lawful money on 
demand at the Treasury Depart¬ 
ment of the United States, in the 
city of Washington, District of 
Columbia, or at any Federal reserve 
bank. 


30 Any Federal reserve bank 
may, upon vote of its direc¬ 
tors, make application to the local 
Federal reserve agent for such 
amount of the Federal reserve notes 
hereinbefore provided for as it may 
deem best. Such application shall 
be accompanied with a tender to the 
local Federal reserve agent of col¬ 
lateral in amount equal to the sum 
of the Federal reserve notes thus ap¬ 
plied for and issued pursuant to 
such application. The collateral se¬ 
curity thus offered shall be notes and 
bills accepted for rediscount under 
the provisions of section 14 of this 
Act, and the Federal reserve agent 
shall each day notify the Federal 
Reserve Board of issues and with¬ 
drawals of notes to and by the Fed¬ 
eral reserve bank to which he is ac¬ 
credited. The said Federal Reserve 
Board shall be authorized at any 
time to call upon a Federal reserve 
bank for additional security to pro¬ 
tect the Federal reserve notes issued 
to it. 


OWEN AMENDMENT. 



QUJ I 1 /A T~> 
U Ultiull, 


SECTION 17. 

NOTE ISSUES. 

Sec. 4? 16. That Federal reserve 
notes, to be issued at the discretion 
of the Federal Reserve Board for 
the purpose of making advances to 
Federal reserve banks through the 
Federal reserve agents as here- 
49 inafter set forth and for no 
other purpose, are hereby 
authorized. The said notes shall be 
obligations of the United States and 
shall be receivable for all taxes, 
customs, and other public dues. 
They shall be redeemed in gold ©r 
l awful mono} 7 on demand at the 
Treasury Department of the United 
States, in the city of Washington. 
District of Columbia, or in gold or 
lawful money at any Federal reserve 
bank. 

Any Federal reserve bank may*- 

application to the local Federal re¬ 
serve agent for such amount of the 
Federal reserve notes hereinbefore 
provided for as it may dee m -- b est 
require. Such application shall be 
accompanied with a tender to the 
local Federal reserve agent of col¬ 
lateral in amount equal to the sum 
of the Federal reserve notes thus 
applied for and issued pursuant to 
such application. The collateral 
security thus offered shall be notes 
and bills accepted for rediscount 
under the provisions of section 44 
13 of this act, and the Federal re¬ 
serve agent shall each day notify 
the Federal Reserve Board of all 
issues and withdrawals of Federal 
reserve notes to and by the Federal 
reserve bank to which he is accred¬ 
ited. The said Federal Reserve 
Board shall be authorized at any 
time to call upon a Federal reserve 
bank for additional security to pro¬ 
tect the Federal reserve notes issued 
to it. 


HITCHCOCK AMENDMENT. 



KnII mn 
uuiiiunr 


NOTE ISSUES. 

Sec. 17. That Federal reserve 
notes, to be issued a t-the- d isc r etion 
under authority of the Federal Re¬ 
serve Board for the purpose of 
making advances to Federal reserve 
banks as hereinafter set forth and 
for no other purpose, are hereby 
authorized. Tne said notes shall 
be obligations of the United States 
and shall be receivable for all taxes, 
customs, and other public dues but 
shall not be held as reserves by mem¬ 
ber banks or by a reserve bank. 
They shall be redeemed in gold or 
lawful money on demand at the 
Treasury Department of the United 
States, in the city of Washington, 
District of Columbia, or at any 
Federal reserve bank. 

48 Any Federal reserve bank 
may, upon vote of its direc¬ 
tors, make application to the local 
Federal reserve agent for such 
amount of the Federal reserve 
notes hereinbefore provided for as 
it may deem-bes t require. Such 
application shall be accompanied 
with a tender to the local Federal 
reserve agent of collateral security 
in amount equal to the sum of the 
Federal reserve notes thus applied 
for and issued pursuant to such ap¬ 
plication. The collateral security 
thus offered shall be notes and bills 
accepted for rediscount under the 
provisions of seetiou- 14 - of this Act, 
and the Federal reserve agent shall 
each day notify the Federal Reserve 
Board of all issues and withdrawals 
of Federal reserve notes to and by 
the Federal reserve bank to which 
he is accredited. The said Federal 
Reserve Board shall be authorized 
at any time to call upon a Federal 
reserve bank for additional security 
to protect the Federal reserve notes 
issued to it. 






































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' 






■ li ■ 






COMPARISON OF CURRENCY BILL. 


38 


SECTION 17 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


eral—reserve—notes- k 

hereinbefore—pwiftetlj—it 

f\( I Ql\nll g.O O 'l’ en 'il i~P 1 it . if n Aii-r> 

0\J ErrTctTT “g^rrt7“ TITfurl \j >V 11 


Q rvQn icil npe m mt aii i£q I w 

l) U vvTti 1 i Vo v * V v ftUvjU ll JU iJ vii iv.5 MUUlVo 



m a k -e-sa id—reserve-eqnal-te-tb irty- 


its—outstanding—Federal—reserve 

#%n. 

l3Ut)“!3. 


Whenever any Federal reserve 
bank shall pay-out or disburse Fed¬ 
eral reserve notes issued to it as 
hereinbefore provided, it shall seg¬ 
regate in its own vaults and shall 
carry to a special reserve account on 
its books gold or lawful money 
equal in amount to thirty-three and 
one-third per centum of the reserve 
notes so paid out by it, such reserve 
to be used for the redemption of said 
reserve notes as presented; but any 
Federal reserve Dank so using any 
part of such reserve to redeem 
notes shall immediately carry 
31 to said reserve account an 
amount of gold or lawful 
money sufficient to make said re¬ 
serve equal to thirty-three and one- 
third per centum of its outstanding 
Federal reserve notes. 


Every Federal reserve bank shall 
maintain reserves in gold or lawful 
money of not less than thirty-five per 
centum against its deposits and its 
Federal reserve notes in actual circu¬ 
lation, but the amount of gold in the 
Federal reserve bank together with the 
amount deposited by it with the Treas¬ 
ury, shall be at least equal to thirty- 
three and one-third per centum of the 
Federal reserve notes issued to said 
bank and in actual circulation and 
not offset by gold or lawful money 
deposited with the Federal reserve 
agent. The Federal Reserve Board 
may notify any Federal reserve bank 
whose lawful reserve shall be below 
the amount required to be maintained 
to make good such reserve; and if such 
bank shall fail for thirty days there¬ 
after so to make good its lawful re¬ 
serve, the Federal Reserve Board may 
suspend and take possession of such 
reserve bank and administer 
51 the same during the period of 
suspension. 


i «• 


HITCHCOCK AMENDMENT. 



eral—Feserve-netes-issned-te-it-as 




nn it n I i» 

V? vT vlcfcT T1 

^ \ ^ ^ \ 1~ I I IV / I A 1‘ n A 1 1 I n in / \ 4 f ll A I’AO A 1'T r H 

ullt? CliTTu T ““11 l»ttJ II t/T^t/TIC I 

n / \ f rt n o r> i / I Lt- if c 11 /. I \ i'aQaiu? a 

IiUdcD oU U tl t IjUhll 1 C/tjUl \ v 

t t y 1)0_l_l _In 1 ‘_t ll a _ 1 Al> i r-t T l / \ > 4 

tv UC uocu IV /1 T 3 IIU TCucIII UCi"jI vTT 

said-reserve-notes-a 



Qfl i-> tMCT f n cm i rl r\C\ r\ r> tl n/inimt 

v?cl 1 i y IJv/ oitiivl 1 vov I V llv vU Ulll) 

n ja n » > i AlljlX a! \ I /d_ /-\ I n u* In I 

(Tti (Ttt rv/TiTiU T7 i v vtu U I TcT 1 It I 


Afilin , I n Fit f || yn A 017 11 

T“3vl V v vjvj \_lcvT cU LIlTTt! > uU I vv cllJv_i 



Whenever any reserve bank shall pay 
out or disburse Federal reserve notes 
issued to it as hereinbefore provided, 
it shall segregate and turn over to its 
reserve agent gold coin or gold 
bullion or United States gold certifi¬ 
cates to the amount of the face value of 
the notes so outstanding, or, at its 
option, shall segregate arid turn over 
to the reserve agent gold coin or gold 
bullion or United States gold certifi¬ 
cates to the amount of forty-five per 
centum of such face value and in addi¬ 
tion thereto collaterals consisting of 
promissory notes and bills accepted 
for rediscount under the provisions of 
this Act, or refunding notes of the 
United States hereinafter provided 
for, or both such collaterals and re¬ 
funding notes equal at their face 
value to one hundred per centum of 
the face value of the notes so outstand¬ 
ing. Such collaterals may be ex¬ 
changed from time to time for other 
collaterals of like quality and of equal 
face value or refunding notes within 
the limitations aforesaid: Provided , 
That whenever and so long as such 
reserve shall fall and remain below 
forty-five per centum the reserve bank 
shall pay a special tax upon the de¬ 
ficiency of reserve at a rate increasing 
in proportion to such deficiency, as 
follows: For each two and one-half 
per centum or fraction thereof that the 
reserve falls below forty-five 
50 per centum a tax shall be 
levied at the rate of one per 
centum per annum: Provided fur¬ 
ther, That no additional circulating 
notes shall be issued whenever and so 
long as the amount of such reserve 
falls below thirty per centum of its 




























V 



























• 










• 



































' 




















* 








■ 

. 











COMPARISON OF CURRENCY BILL. 

SECTION 17—Continued. 


39 


HOUSE BILL. 


OWEN AMENDMENT. 


Notes SO 

paid out shall bear upon their faces 
a distinctive letter and serial num¬ 
ber, which shall be assigned by the 
Federal Reserve Board to each Fed¬ 
eral reserve bank. Whenever Fed¬ 
eral reserve notes issued through 
one Federal reserve bank shall be re¬ 
ceived by another Federal reserve 
bank they shall be returned for re- 
♦demption to the Federal reserve 
bank through which they were orig¬ 
inally issued, or shall be charged off 
against Government deposits and 
returned to the Treasury of the 
United States, or shall be presented 
to the said Treasury for redemption. 

No Federal reserve bank shall pay 
out notes issued through another 
under penalty of a tax of ten per 
centum upon the face value of notes 
so paid out. Notes presented for 
redemption at the Treasury of the 
United States shall be paid and re¬ 
turned to the Federal reserve banks 
through which they were originally 
issued, and Federal reserve notes 
received by the Treasury otherwise 
than for redemption snail be ex¬ 
changed for lawful money out of the 
five per centum redemption fund 
hereinafter provided and returned 
as hereinbefore provided to the re¬ 
serve bank through which they 
were originally issued. 


The Federal Reserve Board shall 
have power, in its discretion, to re¬ 
quire Federal reserve banks 
32 to maintain on deposit in the 
Treasury of the United 
States a sum in gold equal to five 
per centum of such amount of Fed¬ 
eral reserve notes as may be issued 
to them under the provisions of this 
Act; but such five per centum shall 
be counted and included as part of 
the thirty-three and one-third per 
centum reserve hereinbefore re¬ 
quired. 


Notes so paid 
out shall bear upon their faces a dis¬ 
tinctive letter and serial number, 
which shall be assigned by the Fed¬ 
eral Reserve Board to each Federal 
reserve bank. Whenever Federal 
reserve notes issued through one 
Federal reserve bank shall be re¬ 
ceived by another Federal reserve 
bank they shall be promptly returned 
for credit or redemption to the Fed¬ 
eral reserve bank through which 
they were originally issued -er-shall 



re d e mp tion? 

No Federal reserve 
bank shall pay out notes issued 
through another under penalty of a 
tax of ten per centum upon the face 
value of notes so paid out. Notes 
presented for redemption at the 
Treasury of the United States shall 
be paid out of the redemption fund 
and returned to the Federal reserve 
banks through which they were 
originally issued;- and . Federal re¬ 
serve notes received by the Treas¬ 
ury, otherwise than for redemption, 
s h a l l may be exchanged for l a wful 
mo ney gold out of the five - pe r 
e entum redemption fund hereinafter 
provided and returned as-herein- 
bcfore - pr o v ided to the reserve bank 
through which they were originally 
issued, or they may be returned to 
such bank for the credit of the United 
States. Federal reserve notes unfit 
for circulation shall be re- 
62 turned by the Federal reserve 
agents to the Comptroller of 
the Currency for cancellation arid 
destruction. 

The Federal Reserve Board shall 

quire each Federal reserve bank s 
bank to maintain on deposit in the 
Treasury of the United States a sum 
in gold equal to fiv e-- p er centum of 
sufficient in the judgment of the Secre¬ 
tary of the Treasury for the redemp¬ 
tion of s uch amoun t - o f the Federal 
reserve notes as may— be issued to 


Aet such bank but m no event less than 
five per centum; but such fiv e- p er 
centum deposit of gold shall be count- 


HITCHCOCK AMENDMENT. 

outstanding notes: Provided, That 
the amount of such tax paid by the 
bank during a fiscal year shall be 
charged to the member banks in its 
district in proportion to their average 
discounts during that year. 

Notes 

so paid out shall bear upon their 
faces a distinctive letter and serial 
number, which shall be assigned by 
the Federal Reserve Board to each 
Federal reserve bank. Whenever 
Federal reserve notes issued through 
one Federal reserve bank shall be 
received by another Federal reserve 
bank they shall be returned 
promptly for redemption to the 
Federal reserve bank through which 
they were originally issued, or s hall 



be—pres ented - to the said-Treasury 

L . \ r> v , \ 1 > -> t i / \ i 

xm ruuuuiuiiuiii' 

No Federal reserve 
bank shall pay out notes issued 
through another under penalty of 
a tax of ten per centum upon the 
face value of notes so paid out. 
Notes presented for redemption at 
the Treasury of the United States 
shall be paid 



lawful mon e y —out—of—the—five 

51 


In A/-1 n o -h PVP inh pf A 1' A rvVA 
t u nzvvi cio itutu ixiT7urv7Tp i v 

e ve bank - thro u gh 


out of the redemption fund and shall 
not be reissued except upon compli¬ 
ance with the conditions of an original 
issue. 


The Federal Rcscrvc - Board -s h a ll 

require Federal reserve banks to 
shall maintain on deposit in the 
Treasury of the United States a 
sum in gold equal to five per centum 
of such amount of Federal reserve 
notes as may be issued to them and 
outstanding under the provisions of 
this Act and such additional sums 
as the Secretary of the Treasury may 
from time to time decide to be neces¬ 
sary, not exceeding in the aggregate 
ten per centum, but such five - per 





















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. -'v 

. / 


I I 





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. 

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• " ..■, . .j .... , ,, ' S/ ■ 























COMPARISON OF CURRENCY BILL. 

SECTION 17 — Continued. 


40 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


ed and included as part of the thir¬ 
ty-three and one-third per centum 
reserve hereinbefore required. 


The said board shall also 
have the right to grant in whole or 
in part or to reject entirely the ap- 

E lication of any Federal reserve 
ank for Federal reserve notes; but 
to the extent and in the amount that 
such application may be granted 
the Federal Reserve Board shall, 
through its local Federal reserve 
agent, deposit Federal reserve notes 
with the bank so applying, and such 
bank shall be charged with the 
amount of such notes and shall pay 
such rate of interest on said amount 
as may be established by the Fed¬ 
eral Reserve Board, which rate shall 
not be less than one-half of one per 
centum per annum, and the amount 
of such Federal reserve notes so 
issued to any such bank shall, upon 
delivery, become a first and para¬ 
mount lien on all the assets of such 
bank. 


The 

said board shall also have the right, 
acting through the Federal reserve 
agent, to grant in whole or in part or 
to reject entirely the application of 
any Federal reserve bank for Fed¬ 
eral reserve notes; but to the extent 
and-in- the amoun t that such appli¬ 
cation may be granted the Federal 
Reserve Board shall, through its 
local Federal reserve agent, deposit 
supply Federal reserve notes with to 
the bank s bank so applying, and such 
bank shall be charged with the 
amount of such notes and shall pay 
such rate of interest on said amount 
as may be established by the Fed¬ 
eral Reserve Board, w - h i eh-r a te s h all 



and the amount 
such Federal reserve notes 
53 so issued to any such bank 
shall, upon delivery, become 
a first and paramount lien on all the 
assets of such bank. 


Any Federal reserve bank may at 
any time reduce its liability for out¬ 
standing Federal reserve notes by 
the deposit of Federal reserve notes, 
whether issued to such bank or to 
some other reserve bank, or lawful 
money of the United States, 
33 or gold bullion,with any Fed¬ 
eral reserve agent or with the 
Treasurer of the United States, and 
such reduction shall be accompanied 
by a corresponding reduction in the 
required reserve fund of lawful 
money set apart for the redemption 
of said notes and by the release of a 
corresponding amount of the col¬ 
lateral security deposited with the 
local Federal reserve agent. 


t - 


Any Federal reserve bank may at 
any time reduce its liability for out¬ 
standing Federal reserve notes by 
the depo s i t o f depositing, with the 
Federal reserve agent, its Federal re¬ 
serve notes, 



States^-er gold 
Treasurer-ef-tbe-L ni fced St afees-aed 


1 \ ~t~t n si l p im r lliof lfWl 1 I h A 

Oy (t vt/TTUo t uaUCoitTil ill IIIU 



t, gold cer¬ 
tificates, or lawful money of the United 
States. Federal reserve notes so de¬ 
posited shall not be reissued, except 
upon compliance with the conditions 
of an original issue. 

The Federal reserve agent shall 
hold such gold, gold certificates, or 
lawful money available exclusively 
for exchange for the outstanding Fed¬ 
eral reserve notes when offered by the 
reserve bank of which he is a director. 
Upon the reguest of the Secretary of 


ce ntum deposit of gold which shall 
be segregated and maintained as a 
trust fund shall be counted and 
included as part of the 

reserve 
against said 

notes. 

The said board shall also 
have-the-^ighfe-te grant i n -w h ole-er 
m-part-or-te-rejeet-entirely the ap¬ 
plication of any Federal reserve 
bank for Federal reserve notes ; - b u t 




provided said reserve bank complies 
with the requirements of this Act as 
to gold reserve and collateral 
52 security and otherwise con¬ 
forms to its provisions. The 
bank shall be charged with the 
amount of such notes and-sbaH-pay 
sueh-rate-ef-interest-oe-said-a m e u nt 
as-may-tee-e 



issue d -t o a ny - such - bank s hal ly which, 
upon delivery, shall become a first 
and paramount lien on all the assets 
of such bank. 

Any Federal reserve bank may at 
any time reduce its liability for out¬ 
standing Federal reserve notes by 



►UC V OI bIie~ty ±±ttet±-^tR;LC3, OI-gtt+tt 

Hieuj- redeeming the same and, de¬ 
nting them with auy its Federal 
erve agent- : ^- 



set-apart-for-tbe-redempf ien-ef-sa id 


spending- 

Cl Anil l 1 i ti' t ' \ I I 1 yy 1 t~ 1> t I > A 1 1 

SCUttrttn vj j *“o i tJtj“ \v TtTTT t/11C HJ“cTT 

Fede-Hahresenve-aeent, who shall for¬ 
ward them to the Treasury for retire¬ 
ment. 













.. i ; . :0 ...:::: 

































■ 




* 






















■ 
























































. 










( ■ i. ' 

































COMPARISON OF CURRENCY BILL. 

SECTION 17—Continued. 


41 


HOUSE BILL. 


Any Federal reserve bank may 
at its discretion withdraw collateral 
deposited with the local Federal 
reserve agent for the protection of 
Federal reserve notes deposited 
with it and shall at the same time 
substitute other collateral of equal 
value approved by the Federal 
reserve agent under regulations to 
be prescribed by the Federal Re¬ 
serve Board. 


OWEN AMENDMENT. 

the Treasury the Federal Reserve 
Board shall require the Federal re¬ 
serve agent to transmit so much 

54 of said gold to the Treasury ot' 
the United States as may be 

required for the exclusive purpose of 
the redemption of such notes. 

Any Federal reserve bank may at 
its discretion withdraw collateral 
deposited with the local Federal re¬ 
serve agent for the protection of its 
Federal reserve notes deposited with 
it and shall at the same time sub¬ 
stitute then for other like collateral 
of equal value amount a pprov e d by 
with the approval of the Federal re¬ 
serve agent under regulations to be 
prescribed by the Federal Reserve 
Board. 

In order to furnish suitable notes 
for circulation as Federal reserve 
notes, the Comptroller of the Currency 
shall, under the direction of the Sec¬ 
retary of the Treasury, cause plates 
and dies to be engraved in the best 
manner to guard against counterfeits 
and fraudulent alterations, and shall 
have printed therefrom and numbered 
such quantities of such notes of the 
denominations of $1, $2, $5, $10, 
$20, $50, $100, as may be required 
to supply the Federal reserve banks. 
Such notes shall be in form and tenor 
as directed by the Secretary of the 
Treasury under the provisions of this 
Act and shall bear the distinctive 
numbers of the several Federal re¬ 
serve banks through which they are 
issued. 

When such notes have been pre¬ 
pared, they shall be deposited, in the 
Treasury, or in the subtreasury or 
mint of the United. States nearest the 
place of business of each Federal re¬ 
serve bank and shall be held for 

55 the use of such bank subject to 
the order of the Comptroller of 

the Currency for their delivery, as 
provided by this Act. 

The plates and dies to be procured 
by the Comptroller of the Currency 
for the printing of such circulating 
notes shall remain under his control 
and direction, and the expenses neces¬ 
sarily incurred in executing the laws 
relating to the procuring of such notes, 
and all other expenses incidental to 
their issue and retirement, shall be 
paid by the Federal reserve banks, 
and the Federal Reserve Board shall 
include in its estimate of expenses 
levied against the Federal reserve 
banks a sufficient amount to cover 
the expenses herein provided for. 


HITCHCOCK AMENDMENT. 


In 

order to furnish suitable Federal re¬ 
serve notes, the Comptroller of the Cur¬ 
rency shall, under the direction of the 
Secretary of the Treasury, cause 
plates and dies to be engraved in the 
best manner to guard against counter¬ 
feits and fraudulent alterations, and 
shall have printed therefrom and num¬ 
bered such quantities of such notes in 
blank of the denominations of $5, $10, 
$20, $50, $100, $500, $1,000, as 
may be required to supply the reserve 
banks entitled to receive the same. 
Such notes shall be inform and tenor 
provided for in this Act. 


When such notes have been pre¬ 
pared, they shall be deposited in the 
Treasury, or in the subtreasury of 
the United States nearest the place 
of business of each reserve 
54 bank, and shall be held for the 
use of such bank, subject to 
the order of the Federal Reserve 
Board for their delivery, as provided 
by this Act. 

The plates and dies to be procured 
by the Comptroller of the Currency 
for the printing of such circulating 
notes shall remain under his control 
and direction, and the expenses neces¬ 
sarily incurred in executing the laws 
relating to the procuring of such 
notes, and all other expenses inci¬ 
dental to their issue and retirement, 
shall be paid by the reserve banks, 
and the Federal Reserve Board shall 
include in its estimate of expenses 
levied against the reserve banks a 
sufficient amount to cover the ex¬ 
penses herein provided for. 


at-its-* 

depesited-with th e- l eeal-Federat-re- 



—tune 

sub s t itote-etbe-r-eeffateeal-ef 



20622—S. Doc. 264, 63-2-6 






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‘ 











































































































































COMPARISON OF CURRENCY BILL. 


42 


SECTION 17—Continued. 


HOUSE BILL. 


It shall be the duty of every Fed¬ 
eral reserve bank to receive on de¬ 
posit, at par and without charge for 
exchange or collection, checks and 
drafts drawn upon any of its 
depositors or by any of its depos¬ 
itors upon any other depositor and 
checks and drafts drawn by any 


OWEN AMENDMENT. 

The examination of plates, dies, 
bed pieces, and so forth, and regula¬ 
tions relating to such examination of 
plates, dies, and so forth, of national- 
bank notes provided for in section 
fifty-one hundred and seventy-four, 
Revised Statutes, is hereby extended 
to include Federal reserve notes herein 
provided for. 

Any appropriation heretofore made 
out of the general funds of the Treas¬ 
ury for engraving plates and dies, the 
purchase of distinctive paper, or tp 
coyer any other expense in connection 
with the printing of national-bank 
notes or notes provided for by the 
Act of May thirtieth, nineteen hun¬ 
dred and eight, and any distinctive 
paper that may be on hand at the 
time of the passage of this Act may 
be used in the discretion of the Secre¬ 
tary for the purposes of this 
56 Act, and should the appro¬ 
priations heretofore made be 
insufficient to meet the requirements 
of this Act in addition to circulating 
notes provided for by existing law, 
the Secretary is hereby authorized to 
use so much of any funds in the 
Treasury not otherwise appropriated 
for the purpose of furnishing the notes 
aforeasid: Provided, however, That 
nothing in this section contained shall 
be construed as exempting national , 
banks or Federal reserve banks from 
their liability to reimburse the United 
States for any expenses incurred in 
printing and issuing circulating notes. 


HITCHCOCK AMENDMENT. 


The examination of plates, dies, 
bed pieces, ami so forth, and regula¬ 
tions relating to such examination■ of 
plates, dies, and so forth, of national- 
bank notes provided for in section 
ffity-one hundred, and seventy-four, 
Revised Statutes, is hereby extended 
to include Federal reserve notes herein 
provided for. 

Any appropriation heretofore made 
out of the general funds of the Treas¬ 
ury for engraving plates and dies, 
the purchase of distinctive paper, or 
to cover any other expense in con¬ 
nection with the printing of national- 
bank notes or notes provided for by the 
Act of May thirtieth, nineteen hundred 
and eight, and any distinctive paper 
that may be on hand at the time of 
the passage of this Act may he 
55 used, in the discretion of the 
Secretary, for the purposes of 
this Act; and should the appropria¬ 
tions heretofore made be insufficient 
to meet the requirements of tills Act, 
in addition to circulating notes pro¬ 
vided for by existing law, the Secre¬ 
tary is hereby authorized to use so 
much as may be necessary of any 
funds in the Treasury not otherwise 
appropriated for the purpose of fur¬ 
nishing the notes aforesaid: Provided, 
however, That nothing in this section 
contained shall be construed as ex¬ 
empting national banks or Federal 
reserve banks from their liability to 
reimburse the United States for any 
expenses incurred in printing and 
issuing circulating notes. 



, 1 nn f tq O yn U ’D Tl TIOll_i l ■ \ ' / . h _lfQ rj A 

*11 tlx tkj vl I (l 11 liUUH iXiry v 7 i TLo vtU 

■FS 


IT “vpt7“TCoT 

F- F e d eyai-rese-rve - banfe 


it ix / 1 i j I'll i l l) I n »> x» ,.!■ 

rTTiTT uT(IT” vTT c i > > n IJ V <TIT > VI VJ | TrUT 

i n n 11 i- n h ilO I* a A fl /-v y Q 1 l‘<~> - .’<•> \ r r\ 1 > n i i 1 - 

t ri fill \ uciirT rT/u“Trn tv'o“tvu iJctlllY 



v — tr -- -. o 

eeuaiti i ng -f-unds-f o-r-the ir-paferensr 
Every Federal reserve bank shall 
receive on deposit from member banks 
or from Federal reserve banks checks 
and drafts drawn upon any of its 
depositors, and when remitted by 
a Federal reserve bank, checks and 
drafts drawn by any depositor in any 
other Federal reserve bank or 


©habit- 

PCR, 

cfin n li l r 1 r*po’os i t ~-n _(Vptnfll ov 

“ V/1 It! UTvj rTTlTlTgUoi/U U\7TXTT nuC un I U7\ 

pefises-inewred- tfi-eeheet i ng - and re- 
Hiitting- 4 u«d 9 -f©a ! -tb©ia ! -pata ! ©fi 9 v 
Every Federal reserve bank shall 
receive on deposit from member banks 
or from reserve banks checks and 
drafts drawn upon any of its de¬ 
positors, and, when remitted by a 
reserve bank, checks and drafts drawn 
by any depositor in any other reserve 
bank or member bank upon funds to 















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■ 

















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■' 




















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■ 




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• • ■ .>• . ,-v s • : 

. V ' • '•» ' r. 




‘ .. Vi - •. • i: 







COMPARISON OF CURRENCY BILL. 

SECTION 17 — Continued. 


43 


HOUSE BILL. 

depositor in any other Federal re¬ 
serve bank upon funds to the credit 
of said depositor in said reserve 
bank last mentioned, nothing herein 
contained to be construed as pro¬ 
hibiting member banks from mak¬ 
ing reasonable charges to cover 
actual expenses incurred in col¬ 
lecting and remitting funds for 
their patrons. 


I'he Federal Re¬ 
serve Board shall make and pro¬ 
mulgate from time to time regula¬ 
tions governing the transfer of 
funds at par among Federal 
reserve banks, and may at 
34 its discretion exercise the 
functions of a clearing house 
for such Federal reserve banks, or 
may designate a Federal reserve 
bank to exercise such functions, 
and may also require each such 
bank to exercise the functions of a 
clearing house for its member banks. 


Sec. 18. That so much of the 
provisions of section fifty-one hun¬ 
dred and fifty-nine of the Revised 
Statutes of the United States, and 
section four of the Act of June 
twentieth, eighteen hundred and 
seventy-four, and section eight of 
the Act of July twelfth, eighteen 
hundred and eighty-two, and of 
any other provisions of existing 
statutes, as require that before any 
national banking association shall 
be authorized to commence bank¬ 
ing business it shall transfer and 
deliver to the Treasurer of the 
United States a stated amount of 
United States registered bonds be, 
and the same is hereby, repealed. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


57 member bank upon funds to 
the credit of said depositor in 
said reserve bank or member bank. 
Nothing herein contained shall be 
construed as prohibiting a member 
bank from making reasonable charges 
for checks and drafts so debited to its 
account, or for collecting and remit¬ 
ting funds, or for exchange sold to its 
patrons. The Federal Reserve Board 
may, by rule, fix the charges to be 
collected by the member banks from 
its patrons whose checks are cleared 
through the Federal reserve bank and 
the charge which may be imposed for 
the service of clearing or collection 
rendered by the Federal reserve bank. 

The Federal Reserve Board shall 
make and promulgate from time to 
time regulations governing the 
transfer of funds at-pa-r and charges 
therefor among Federal reserve 
banks and their branches, and may 
at its discretion exercise the func¬ 
tions of a clearing house for such 
Federal reserve banks, or may des¬ 
ignate a Federal reserve bank to 
exercise such functions, and may 
also require each such bank to exer¬ 
cise the functions of a clearing house 
for its member banks. 


the credit of said depositor in said 
reserve bank or member bank. Noth¬ 
ing herein contained shall be con¬ 
strued as prohibiting a member bank 
from making reasonable charges for 
checks and drafts so debited to its ac¬ 
count, or for collecting and remitting 
funds, or for exchange sold to its 
patrons. The Federal Reserve Board 
may, by rule, fix reasonable charges to 
be collected by the member banks from 
patrons whose checks are cleared 
through the reserve bank and the 
charge which may be imposed for the 
service of clearing or collection 
56 rendered by the Federal reserve 
bank:. 


The Federal Reserve 
Board shall make and promulgate 
from time to time regulations gov¬ 
erning the transfer of funds at-par 
among Federal reserve banks--a«d 
may-at-its-diseretion-exereise-the 

f-beuse-fer 



their branches. 


SECTION 18. 

Sec. 4 S 17. That so much of the 
provisions of section fifty-one hun¬ 
dred and fifty-nine of the Reyised 
Statutes of the United States, and 
section four of the Act of June 
twentieth, eighteen hundred and 
seventy-four, and section eight of 
the Act of July twelfth, eight- 
58 een hundred and eighty-two, 
and of any other provisions 
of existing statutes as require that 
before any national banking asso¬ 
ciation shall be authorized to com¬ 
mence banking business it shall 
transfer and deliver to the Treasurer 
of the United States a stated 
amount of United States registered 
bonds be, and the same is hereby, 
repealed. 


Sec. 18. That so much of the pro¬ 
visions of section fifty-one hundred 
and fifty-nine of the Revised Stat¬ 
utes of the United States, and section 
four of the Act of June twentieth, 
eighteen hundred and seventy-four, 
and section eight of the Act of July 
twelfth, eighteen hundred and 
eighty-two, and of any other pro¬ 
visions of existing statutes, as re¬ 
quire that before any national bank¬ 
ing association shall be authorized 
to commence banking business it 
shall transfer and deliver to the 
Treasurer of the United States a 
stated amount of United States 
registered bonds be, and the same 
is hereby, repealed. 














































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COMPARISON OF CURRENCY BILL. 

SECTION 19. 

OWEN AMENDMENT. HITCHCOCK AMENDMENT. 


REFUNDING BONDS. 


Sec. 19. That upon application 
the Secretary of the Treasury shall 
exchange the two per centum'bonds 
of the United States bearing the 
circulation privilege deposited by 
any national banking association 
with the Treasurer of the United 
States as security for circulating 
notes for three per centum bonds of 
the United States without the cir¬ 
culation privilege, payable after 
twenty years from date of issue, 
and exempt from Federal, State, 
and municipal taxation both 
35 as to income and principal. 

No national bank shall, in 
any one year, present two per cen¬ 
tum bonds for exchange in the 
manner hereinbefore provided to 
an amount exceeding five per cen¬ 
tum of the total amount of bonds 
on deposit with the Treasurer by 
said bank for circulation purposes. 
Should any national bank fftil hi 
any one year to so exchange its full 
quota of two per centum bonds 
under the terms of this Act, the 
Secretary of the Treasury may per¬ 
mit any other national bank or 
banks to exchange bonds in excess 
of the five per centum aforesaid hi 
ah amount equal to the deficiency 
caused by the failure of any one or 
more banks to make exchange in 
any one year, allotment to be made 
to applymg banks in proportion to 
their holdings of bonds. At the 
expiration of twenty years from 
the passage of this Act every holder 
of United States two per centum 
bonds then outstanding shall re¬ 
ceive payment at par and accrued 
interest. After twenty years from 
the date of the passage of this Act 
national-bank notes still remaining 
outstanding shall be recalled and 
redeemed by the national banking 
associations issuing the same within 
a period and under regulations to 
be prescribed by the Federal Re¬ 
serve Board, and notes still remain¬ 
ing hi circulation at the end of such 
period shall be secured by an equal 
amount of lawful money to be de¬ 
posited in the Treasury of the 
United States by the banking 
associations originally issuing such 


REFUN DING- DOND 8 . - 


The Owen amendment proposes to strike 
out all of section 19 of the House bill and 
insert the following: 

60 Sec. 18. Any member banJc 
desiring to retire the whole or 
any part of its circulating notes may 
Me with the Treasurer of the United 
States an application to sell for its 
account, at par and interest, United 
States bonds securing circulation to 
be retired. 

The Treasurer shall, at the end of 
each quarterly period, furnish the 
Federal Reserve Board with a list of 
such applications, and the Federal 
Reserve Board may, in its discretion, 
require the Federal reserve banks to 
purchase such bonds from, the banks 
whose applications have been filed 
with the Treasurer at least ten days 
before the end of any quarterly period 
at which the Federal Reserve Board 
may direct the purchase to be made. 
Upon notice from the Treasurer of 
the amount of bonds so sold for its 
account, each member bank shall 
duly assign and transfer, in writing, 
such bonds to the Federal reserve bank 
purchasing the same, and such Fed¬ 
eral reserve bank shall thereupon de¬ 
posit lawful money with the Treasurer 
of the United States for the purchase 
price of such bo nds, and the Treasurer 
shall pay to the member bank selling 
such bonds any balance due after de¬ 
ducting a sufficient sum to redeem its 
outstanding notes secured by such 
bonds, which notes shall be canceled 
and permanently retired when re¬ 
deemed. 

The Federal reserve banks pur¬ 
chasing such bonds shall be required 
to take out an a,mount, of cir- 
61 culating notes equal to the 
am,ount of national-bank notes 
outstanding against such bonds. 

Upon the deposit with the Treasurer 
of the United States bonds so pur- 
Ichased, or any bonds unth the circu 
ating privilege acquired under section- 
four of this Act, any Federal reserve 
bank making such deposit in the man¬ 
ner provided by existing law shall be 
entitled to receive from the Comp¬ 
troller of the Currency circulating 
notes in blank, registered and coun 
tersigned as provided by law, equal in 
amount to the par value of the bonds so 
deposited. Such notes shall be the 
obligations of the Federal reserve 


REFUNDING BONDS. 


The Hitchcock amendment proposes to 
strike out all of section 19 of the House bill 
and insert the following: 

Sec. 19. That as soon after the 
organization of the reserve banks as 
practicable and under authority from 
the Federal Reserve Board each Fed¬ 
eral reserve bank shall purchase at par 
arid accrued interest two per centum 
bonds of the United States. The 
amount purchased by each reserve 
bank shall not, be more than fifty per 
centum of its capital in any .one year. 
The bonds so purchased may be held 
by suck reserve bank and used for de¬ 
posit with its reserve agent as security 
for the Federal reserve notes issued, or 
they may be exchanged at the Treasury 
for one-year Treasury gold notes bear¬ 
ing three per centum interest. In 
case of such exchange the reserve bank 
shall be bound at the option of 
59 the United States to renew 
year by year for twenty years 
the three per centum, gold notes so 
issued. Said one-year three per cen¬ 
tum United States gold notes mhy be 
used to deposit with the reserve agent 
as secwity for the United States re¬ 
serve notes, or be freely purchased by 
reserve banks from time to time to 
employ idle funds, or sold to protect 
the gold supply. 

National banks which sett two per 
centum bonds to a reserve bank under 
this provision shall retire such portion 
of their outstanding national-bank 
notes as are secured by the bonds so 
sold. The Secretary of the Treasury 
is hereby directed to issue three per 
centum one-year gold Treasury notes 
year by year to exchange for two per 
centum, bonds as above provided or to 
take the place of three per centum one- 
year gold notes that have been re¬ 
deemed. During the period between 
the first and last purchases of bonds 
any national bank may continue to 
apply for and, receive circulating 
notes based upon, the deposit of two 
per centum bonds as now provided for 
by law. The one-year three per 
centum, gold Treasury notes above 
provided for shall be exempt from 
Federal, State, and municipal taxa- 
-tion both as to income and principal. 























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45 


COMPARISON OF CURRENCY BILL. 


S E 

HOUSE BILL. 

notes. Meanwhile every national 
bank may continue to apply 
for and receive circulating 
36 notes from the Comptroller 
of the Currency based upon 
the deposit of two per centum 
bonds or of any other bonds bearing 
the circulation privilege; but no 
national bank shall be permitted 
to issue other circulating notes ex¬ 
cept such as are secured as in this 
section provided or to issue or to 
make use o£ any substitute for such 
circulating notes in the form of 
clearing-house loan certificates, cash¬ 
ier’s checks, or other obligation. 


BANK RESERVES. 


Sec. 20. That from and after the 
date, when the Secretary of the 
Treasury shall have officially an¬ 
nounced, in such manner as he may 
elect, the fact that a Federal reserve 
bank has been established in any 
designated district, every banking 
association within said district 
which shall have subscribed for 
stock in such Federal reserve bank 
shall be required to establish and 
maintain reserves as follows: 

(a) If a country bank as defined 
by existing law, it shall hold and 
maintain a reserve equal to twelve 
per centum of the aggregate amount 
of its deposits, not including savings 
deposits hereinafter provided for. 
Five-twelfths of such reserve shall 
consist of money which national 
banks may under existing law count 
as legal reserve, held actually in the 
bank’s own vaults; and for a period 
of fourteen months from the date 
aforesaid at least three-twelfths and 
thereafter at least five-twelfths of 
such reserve shall consist of a 
credit balance with the Fed¬ 
eral reserve bank of its dis- 


C T I O N 19 — Continue 

OWEN AMENDMENT. 

bank procuring same, and shall be in 
form prescribed by the Secretary of the 
Treasury, and to the same tenor and 
eff vet as national-bank notes now pro¬ 
dded by law. They shall be issued 
under the same terms and conditions 
as national-bank notes. United States 
bonds bought by a Federal reserve 
bank against which there are no out¬ 
standing national-bank notes may be 
exchanged at the Treasury for one- 
year gold notes bearing three per 
centum interest. In case of such ex¬ 
change for one-year notes the reserve 
bank shall be bound to pay such notes 
and to receive in payment thereof new 
three per centum one-year Treasury 
gold notes year by year for the period 
of twenty years. 

SECTION 20. 

BANK RESERVES. 


The Owen amendment [proposes to strike 
out all of section 20 of the House bill and 
insert the following: 

Sec. 19. Demand liabilities within 
the meaning of this Act shall comprise 
all liabilities maturing within thirty 
days, and time deposits shall com¬ 
prise all deposits payable after thirty 
days. 

65 When the Secretary of the 

Treasury shall have officially 
announced, in such manner as he may 
elect, the establishment of a Federal 
reserve hank in any district, every sub¬ 
scribing member bank shall establish 
and maintain reserves as follows: 


(a) A bank not in a reserve or cen¬ 
tral reserve city as now or hereafter 
defned shall hold and maintain re¬ 
serves equal to twelve per centum of 
the aggregate amount of its demand 
liabilities and five per centum of its 
time deposits, as follows: 

In its vaults for a period, of twenty- 
four months after said date four- 
twelfths thereof. 

In the Federal reserve bank of its 
district, for a period of six months 
after said date, two-twelfths, and for 
each succeeding six months an addi¬ 
tional one-twelfth, until five-twelfths 
have been so deposited, which shall be 
the amount permanently required. 


d. 

HITCHCOCK AMENDMENT. 


BANK RESERVES. 


The Hitchcock amendment proposes to 
strike out all of section 20 of the House bill 
and insert the following: 


Sec. 20. That when a Federal re¬ 
serve bank has been duly organized 
and established as provided, in this 
Act in any Federal reserve district 
every member bank of that district 
shall establish and maintain reserves 
as follows: 


(a) A bank not in a reserve or cen¬ 
tral reserve city as now or hereafter de¬ 
fined shall hold and maintain 
63 reserves equal to twelve per 
centum of the aggregate amount 
of its net deposits, as follows: 

In its vaults, four-twelfths thereof. 

In the Federal reserve bank of its 
district, for a period of six months 
after said date, one-twelfth, and for 
each succeeding six months an addi¬ 
tional one-twelfth, until four-twelfths 
have been so deposited, which shall be 
the amount permanently required . 


37 






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COMPARISON OF CURRENCY BILL. 


46 


SECTION 20 —Continued. 


HOUSE BILL. 

trict. The remainder of the twelve 
per centum reserve hereinbefore 
required may, for a period of thirty- 
six months from and after the date 
fixed by the Secretary of the Treas¬ 
ury as hereinbefore provided, con¬ 
sist of balances due from national 
banks in reserve or central reserve 
cities as now defined by law. From 
and after a date thirty-six months 
subsequent to the date fixed by the 
Secretary of the Treasury as herein¬ 
before provided the said remainder 
of the twelve per centum reserve 
required of each country bank shall 
consist either in whole or in part of 
reserve money in the bank’s own 
vaults or of credit balance with the 
Federal reserve bank of its district. 

(b) If a reserve city bank as de¬ 
fined by existing law, it shall hold 
and maintain, for a period of sixty 
days from the date fixed by the 
Secretary of the Treasury as hei ein- 
before provided, a reserve equal to 
twenty per centum of the aggregate 
amount of its deposits, not including 
savings deposits hereinafter pro¬ 
vided for, and permanently there¬ 
after eighteen per centum. At least 
one-half of sucn reserve shall consist 
of money which national banks may 
under existing law count as legal 
reserve, held actually in the bank’s 
own vaults. After sixty days 
from the date aforesaid, and for a 
period of one year, at least three- 
eighteenths and permanently there¬ 
after at least five-eighteenths of 
such reserve shall consist of a credit 
balance with the Federal 
38 reserve bank of its district. 

The remainder of the reserve 
in this paragraph required may, for 
a period of thirty-six months from 
and after the date fixed by the Sec¬ 
retary of the Treasury as herein¬ 
before provided, consist of balances 
due from national banks in central 
reserve cities as now defined by law. 
From and after a date thirty-six 
months subsequent to the date 
fixed by the Secretary of the Treas¬ 
ury as hereinbefore provided, the 
said remainder of the eighteen per 
centum reserve required of each 
reserve city bank shall consist 
either in whole or in part of reserve 
money in the bank’s own vaults or 
of credit balance with the Federal 
reserve bank of its district. 


OWEN AMENDMENT. 

For a period of twenty-four months 
after said date the balance of the re¬ 
serves may be held in its own vaults, 
or in the Federal reserve bank, or in 
banks in reserve or central reserve 
cities as now defined by law. 

After said twenty-four months' pe¬ 
riod said reserves, other than those 
hereinbefore required to be held in the 
reserve bank, shall be held in the 
vaults of the member bank or in the 
Federal reserve bank, or in both, at 
its option. 


66 ( b) A bank in a reserve city, 

as now or hereafter defined, 
shall hold and maintain .reserves 
equal to fifteen per centum of the 
aggregate amount of its demand lia¬ 
bilities and five per centum of its time 
deposits, as follows: 

In its vaults six-fifteenths thereof. 

In the Federal reserve bank of its 
district for a period of six months 
after the date aforesaid at least three- 
fifteenths, and for each succeeding six 
months an additional one-fifteen*h, 
until six-fifteenths have been so de¬ 
posited, which shall be the amount 
permanently required. 


After said twenty-four months' 
period all of said reserves, except 
those hereinbefore required to be held 
permanently in the Federal reserve 
bank, shall be held in its vaults or in 
the Federal reserve bank, or in both, 
at its option. 


HITCHCOCK AMENDMENT. 


After said period said reserves, 
other than those hereinbefore required 
to be held in the reserve bank, may be 
held in the vaults of the member bank 
or in the Federal reserve bank, or in 
both, at the option of the member bank~ 


( b ) A bank in a reserve or a central 
reserve city, as now or hereafter de¬ 
fined, shall hold and maintain reserves 
equal to fifteen per centum, of the ag¬ 
gregate amount of its net deposits, as 
follows: 

In its vaults, five-fifteenths thereof. 

In the Federal reserve bank of its 
district for a period of six months 
after the date aforesaid at least one- 
fifteenth, and for each succeeding six 
months an additional one-fifteenth, 
until six-fifteenths have been so depos¬ 
ited, which, shall be the amount per¬ 
manently required. 


After said period all of said re¬ 
serves, except those hereinbefore re¬ 
quired to be held permanently 
64 in the Federal reserve bank, 
may be held in its own vaults 
or in the Federal reserve bank, or in 
both, at the option of the member bank. 






















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COMPARISON OF CURRENCY BILL, 

SECTION 20—Continued. 


47 


HOUSE BILL. 

(c) If a central reserve city bank 
as defined by existing law, it shall 
hold and maintain for a period of 
sixty days from the date fixed by 
the Secretary of the Treasury as 
hereinbefore provided a reserve 
equal to twenty per centum of the 
aggregate amount of its deposits, 
not including savings deposits here¬ 
inafter provided for, and perma¬ 
nently thereafter eighteen per cen¬ 
tum. At least one-half of such re¬ 
serve shall consist of money which 
national banks may under existing 
law count as legal reserve, held 
actually in the bank’s own vaults. 
After sixty days from the date afore¬ 
said, and thereafter for a period of 
one year, at least three-eighteenths 
and permanently thereafter at least 
five-eighteenths of such reserve shall 
consist of a credit balance with the 
Federal reserve bank of its dis¬ 
trict. The remainder of the 
39 eighteen per centum reserve 
required of each central re¬ 
serve city bank shall consist either 
in whole or in part of reserve money 
actually held in its own vaults or 
of credit balance with the Federal 
reserve bank of its district. 


OWEN AMENDMENT. 

(c) A bank in a central reserve city, 
as now or hereafter defined, shall 
hold and maintain a reserve equal to 
eighteen per centum of the aggregate 
amount of its demand liabilities and 
five per centum of its time deposits, as 
follows: 

In its vaults six-eighteenths thereof. 

In the Federal reserve bank for a 
period of six months after the date 
aforesaid at least three-eighteenths, 
arid permanently thereafter six- 
eighteenths. 

The balance of said reserves shall 
be held in its own vaults or in the Fed¬ 
eral reserve bank at its option. 
67 Any Federal reserve bank 
may receive from the member 
banks as reserves, not exceeding one- 
half of each installment, eligible paper 
as described in section fourteen prop¬ 
erly indorsed and acceptable to the said- 
reserve bank. 


If a State bank or trust company is 
required by the law of its State to 
keep its reserves either in its own 
vaults or with another State bank or 
trust company, such reserve deposits 
so kept in such State bank or trust 
company shall be construed, within 
the meaning of this section, as if they 
were reserve deposits in a national 
bank in a reserve or central reserve 
city for a period of three years after 
the Secretary of the Treasury shall 
have officially announced the estab¬ 
lishment of a Federal reserve bank in 
the district in which such State bank 
or trust company is situate. Except 
as thus provided, no member bank 
shall keep on deposit with any non¬ 
member bank a sum in excess of ten 
per centum of its own paid-up capital 
and surplus. No member bank shall 
extend directly or indirectly the bene¬ 
fits of this system to a nonmember 
bank, except upon written permission 
of the Federal Reserve Board, under 
penalty of suspension. 

68 The reserve carried by a 

member bank with a Federal 
reserve bank may, under the regula¬ 
tions and subject to such penalties as 
may be prescribed by the Federal Re¬ 
serve Board, be checked against and 
withdrawn by such member bank for 


HITCHCOCK AMENDMENT. 


> See aubsection b. 


If a State bank or trust company is 
required by the laws of its State to keep 
its reserves either in its own vaults or 
with another State bank or trust com¬ 
pany, such reserve deposits so kept in 
such State bank or trust company shall 
be construed, within the meaning of 
this section, as if they were reserve de¬ 
posits in a national bank in a reserve 
or central reserve city for a period of 
three years after the establishment of a 
Federal reserve bank in the district in 
which such State bank or trust com¬ 
pany is situate. 








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COMPARISON OF CURRENCY BILL. 


48 


SE 


HOUSE BILL. 


Sec. 21. That so much of sections 
two and three of the Act of June 
twentieth, eighteen hundred and 
seventy-four, entitled “An Act fix¬ 
ing the amount of United States 
notes, providing for a redistribu¬ 
tion of the national bank currency, 
and for other purposes,” as provides 
that the fund deposited by any 
national banking association with 
the Treasurer of the United States 
for the redemption of its notes shall 
be counted as a part of its lawful 
reserve as provided in the Act afore¬ 
said, be, and the same is hereby, 
repealed. And from and after the 
passage of this Act such fund of 
five per centum shall in no case be 
counted by any national banking 
association as a part of its lawful 
reserve. 


Sec. 22. That every Federal re¬ 
serve bank shall at all times have 
on hand in its own vaults, in gold 
or lawful money, a sum equal to 
not less than thirty-three and one- 
third per centum of its outstanding 
demand liabilities. 


CTION 20—Continued. 


OWEN AMENDMENT. 

the 'purpose of meeting existing lia¬ 
bilities: Provided, however, That no 
bank shall at any time make new 
loans or shall pay any dividends un¬ 
less and until the total reserve re¬ 
quired by law is f ully restored. 

United States banks located in 
Alaska or outside the Continental 
United States may remain nonmember 
banks, and shall in that event main¬ 
tain reserves and comply with all the 
conditions now provided by law regu¬ 
lating them: or said banks, except in 
the Philippine Islands, may, with the 
consent of the Reserve Board, become 
member banks of any one of the re¬ 
serve districts, and shall, in that 
event, take stock, maintain reserves, 
and be subject to all the other pro¬ 
visions of this Act. 

SECTION 21. 

Sec. 34 20. Thaf-s© So much of 
sections two and three of the Act of 
June twentieth, eighteen hundred 
and seventy-four, entitled “An Act 
fixing the amount of United States 
notes, providing for a redistribution 
of the national bank currency and 
for other purposes,” as provides 
that the fund deposited by any na¬ 
tional banking association with the 
Treasurer of the United States for 
the redemption of its notes shall be 
counted as a part of its lawful re¬ 
serve as provided in the Act 
69 aforesaid, be, and the same is 
hereby, repealed. And from 
and after the passage of this Act 
such fund of five per centum shall in 
no case be counted by any national 
banking association as a part of its 
lawful reserve. 

SECTION 22. 


-Federal—re¬ 
serve—bank—shall-at-all-tlmes-have 
©n-band-ift- its-©wn-vardt© 5 -ifi-g©ldy 



i f Cl _ Ant at n 11 cl 1 n /-v» cl /~v 

TT7“ UllInullllU il 1 LIU 


maud-1 lab 11 it ies 


HITCHCOCK AMENDMENT. 


Sec. 21. That so much of sections 
two and three of the Act of June 
twentieth, eighteen hundred and 
seventy-four, entitled “An Act fix¬ 
ing the amount of United States 
notes, providing for a redistribution 
of the national bank currency, 
and for other purposes,” as provides 
that the fund deposited by any na¬ 
tional banking association with the 
Treasurer of the United States for 
the redemption of its notes shall be 
counted as a part of its lawful re¬ 
serve as provided in the Act afore¬ 
said, be, and the same is hereby, re¬ 
pealed. And from and after the 
passage of this Act such fund of five 
per centum shall in no case be 
counted by any national banking 
association as a part of its lawful 
reserve. . 


Sec. 22. That every Federal re¬ 
serve bank shall at all times have on 
hand in its own vaults, in 
65 gold, gold certificates, or law¬ 
ful money, a sum equal to 
not less than thietwthree-ftrtd-one- 
tfeird thirty-five per centum of its 

deposits, in addition to the reserve 
required against the Federal reserve 
notes emitted by such bank. The 
term “net deposits” wherever used in 
this Act shall mean net deposits as 
from time to time defined by the 
Comptroller of the Currency, subject 
to the approval of the Federal Reserve 
Board. 
















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COMPARISON OF CURRENCY BILL. 


49 


SECTION 22 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


The Federal Reserve Board may 
notify any Federal reserve bank 
whose lawful reserve shall be below 
the amount required to be kept on 
hand, to make good such reserve; 
and if such bank shall fail for thirty 
days thereafter so to make good its 
lawful reserve, the Federal Reserve 
Board may appoint a receiver to 
wind up the business of said bank. 



The Federal Reserve Board may 
notify any Federal reserve bank 
whose lawful reserve shall be below 
the amount required to be kept on 
hand to make good such reserve; 



Boacd-may-a 
wi 

in the meantime may prohibit such 
Federal reserve bank from making 
additional loans or discounts: Pro¬ 
vided, however, That the Federal Re¬ 
serve Board may in case of emergency 
permit the reserve against deposits to 
be reduced below the said limit, but 


the reserve bank shall in such case 
pay a tax at the rate of one per centum 
per annum for every two and one-half 
per centum or fraction thereof that 
the reserve falls below said thirty-five 
per centum, but in no case shall it 
be allowed to fall below twenty-five 
per centum of its net deposits: Pro¬ 
vided further, That the amount 
66 of such tax paid by the bank 
during a fiscal year shall be 
charged to the member banks in the 
district in proportion to their average 
discounts during that year. 


40 BANK EXAMINATIONS. 

Sec. 23. That the examination of 
the affairs of every national banking 
association authorized by existing 
law shall take place at least twice in 
each calendar year and as much 
oftener as the Federal Reserve 
Board shall consider necessary in 
order to furnish a full and complete 
knowledge of its condition. The 
Secretary of the Treasury may, 
however, at any time direct the 
holding of a special examination. 
The person assigned to the making 
of such examination of the affairs of 
any national banking association 
shall have power to call together a 
quorum of the directors of such asso¬ 
ciation, who shall, under oath, state 
to such examiner the character and 
circumstances of such of its loans or 
discounts as he may designate; and 
from and after the passage of this 
Act all bank examiners shall receive 
fixed salaries, the amount whereof 
shall be determined by the Federal 
Reserve Board and annually re- 
20622—S. Doc. 264, 63-2-7 


SECTION 23. 

BANK EXAMINATIONS. 

Sec. 93 21. Tkat-tbe-examination 

of^be-aflbics-ef-evecy-national-banh- 


BANK EXAMINATIONS. 

Sec. 23. That the examination of 
the affairs of every national-banking 


ing - l aw Every member bank shall 
ta k e pl aee be examined by the Comp¬ 
troller of the Currency at least twice 
in each calendar year and as much 
oftener as the Federal Reserve 
Board shall consider necessary—in 


-The 


The 


Federal Reserve Board may authorize 
examinations by the State authorities 
to be accepted in the case of State 
banks and trust companies and may ? 

how eve ry at any time direct 
70 the holding of a special ex¬ 
amination. The person as- 
si gncd to -t h e making ©f-sneb the ex¬ 
amination ©f-tbe-afiaics of any na- 
tienal—banking-association member 
bank shall have power to call to¬ 
gether a quorum of the directors of 
such association bank, who shall, 
under oath, state to such examiner 


ing—law member bank shall take 
place at least twice in each calen¬ 
dar year and as much oftener as 
the Federal Reserve Board shall 
consider necessary in order to fur¬ 
nish a full and complete knowledge 
of its co ndition . ^ The 8eerc tarjyot 

eral Reserve Board may authorize 
examinations by the State authori¬ 
ties to be accepted in the case of State 
banks and trust companies and may 
at any time direct the holding of a 
special examination. The person 
assigned to the making of such ex¬ 
amination of the affairs of any 

ber bank shall have power to call 
together a quorum of the directors 
of such association bank, who shall, 
under oath, state to such examiner 
the character and circumstances of 
such of its loans or discounts as he 























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. 






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COMPARISON OF CURRENCY BILL. 

SECTION 23 — Continued. 


50 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


ported to Congress. But the ex¬ 
pense of the examinations herein 
provided for shall be assessed by the 
Federal Reserve Board upon the 
associations examined in propor¬ 
tion to assets or resources helcf by 
such associations upon a date during 
the year in which such examinations 
are held to be established by the 
Federal Reserve Board. The Comp¬ 
troller of the Currency shall so ar¬ 
range the duties of national-bank 
examiners that no two successive 
examinations of any association 
shall be made by the same ex¬ 
aminer. 


41 In addition to the exam¬ 

inations made and conducted 
by the Comptroller of the Currency, 
every Federal reserve bank may, 
with the approval of the Federal 
Reserve Board, arrange for special 
or periodical examination of the 
member banks within its district. 
Such examination shall be so con¬ 
ducted as to inform the Federal 
reserve bank under whose auspices 
it is carried on of the condition of 
its member banks and of the lines 
of credit which are being extended 
by them. Every Federal reserve 
bank shall at all times furnish to 
the Federal Reserve Board such 
information as may be demanded 
by the latter concerning the con¬ 
dition of any national banking asso¬ 
ciation located within the district 
of the said Federal reserve bank. 


The Federal Reserve Board shall 
as often as it deems best, and in 
any case not less frequently than 
four times each year, order an 
examination of national banking 
associations in reserve cities. Such 
examinations shall show in detail 
the total amount of loans made by 


the character and circumstances of 
such of its loans or discounts as he 

thmpassage-ef-^iHS-Aet-ai l-bftnk ex' 


< 4 -Til i nova 
rniimuT o 



__ The Federal Reserve 
Board shall fix the salaries of all hank 
examiners and annually—reported 
make report thereof to Congress. 
But-t h e The expense of the exami¬ 
nations herein provided for shall be 
assessed by authority of the Federal 
Reserve Board upon the associ¬ 
ations hanks examined in proportion 
to assets or resources held by such 
associations hanks upon a-date-dnr- 



s ivc ox aminations-of-any—assoeia- 


amme? the dates when the various 
hanks are examined. 

In addition to the examinations 
made and conducted by the Comp¬ 
troller of the Currency, every Fed¬ 
eral reserve bank may, with the ap¬ 
proval of the Federal reserve agent or 
of the Federal Reserve Board, 
71 arrange provide for special or 
periodical examination of the 
member banks within its district. 
Such examination shall be so con¬ 
ducted as to inform the Federal re¬ 
serve bank under whose auspices it 
is carried on of the condition of its 
member banks and of the lines of 
credit which are being extended by 
them. Every Federal reserve bank 
shall at all times furnish to the Fed¬ 
eral Reserve Board such informa¬ 
tion as may be demanded by the 
latter concerning the condition of 

located member hank within the dis¬ 
trict of the said Federal reserve 
bank. 

No hank shall he subject to any 
visitorial powers other than such as 
are authorized hy law, or vested in the 
courts of justice, or such as shall he 
or shall have been exercised or directed 
hy Congress, or either House thereof, 
or any committee thereof. 



nnt l/\ qa _ T 

—I lUt TUCJlJ t 

f imn a ii v — nr not-* fl 

ciTItUO v^ttutiv “-TT ^ U I vl v ' o 

t ion—of-national ba n k ing assoeia- 


amioations-skall-s ho w 1 n - d etail-the 


may designate; and from and after 
the passage of this Act all bank ex¬ 
aminers shall receive fixed salaries, 
the amount whereof shall be not less 
than $2,000 nor more than $7,000 
per annum and he determined by 
the Federal Reserve Board and 
annually reported to Congress. But 
the expense of the examinations 
herein provided for shall be 
67 assessed by authority of the 
Federal Reserve Board upon 
the associations member hanks ex¬ 
amined in proportion to assets or 
resources held by such associations 
member hanks upon a—date- dur i ng 

I nn TT/-V .1 !■_IQ —miuAD QII qL AVtinunn 

UTT” V uTT TTT W II’LIl JUL 11 ^AclUITJLUl 


tiens-are- h eld-t o - b e-es t -ddisbed-by 



amine? the dates when the various 
hanks are examined. 


In addition to the examinations 
made and conducted by the Comp¬ 
troller of the Currency, every Fed¬ 
eral reserve bank may, with the 
approval of the Federal reserve 
agent or of the Federal Reserve 
Board, arrange for special or 

E eriodical examination of the mem- 
er banks within its district. Such 
examination shall be so conducted 
as to inform the Federal reserve 
bank under whose auspices it is 
carried on of the condition of its 
member banks and of the lines of 
credit which are being extended by 
them. Every Federal reserve bank 
shall at all times furnish to the 
Federal Reserve Board such infor¬ 
mation as may be demanded by the 
latter concerning the condition _ of 
any national—banking—association 
member hank located within the 
district of the said Federal reserve 
bank. 





















. . \ : . . 








' 






. 






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. 






• • .... 

■ • . 


























COMPARISON OF CURRENCY BILL. 


51 


SECTION 23 — Continued. 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


each bank on demand, on time, and 
the different classes of collateral 
held to protect the various loans, 
and the lines of credit which are 
being extended by them. The Fed¬ 
eral Reserve Board shall, at least 
once each year, order an examina¬ 
tion of each Federal reserve bank, 
and upon joint application of ten 
member banks the Federal Reserve 
Board shall order a special exam¬ 
ination and^report of the conditon 
of any Federal reserve bank. 



r-loans—and-tbe 
li nes o f c -redit- w - h ieh-aee-being-ex- 
tende d by them. The Federal Re¬ 
serve Board shall, at least once each 
year, order an examination of each 
Federal reserve bank, and upon joint 
application of ten member 
72 banks the Federal Reserve 
Board shall order a special 
examination and report of the con¬ 
dition of any Federal reserve bank. 


+r-OH 


ti me:, and th e- -different- c lasses--of 



w i ! r» n L a Tit < v py lon rlorl I > \ r 1 w~m 11 

VT IlTuT! cCTU I J v” ri U V 

The Federal Reserve Board shall, at 
least once each year, order an ex¬ 
amination of each Federal reserve 
bank, and upon joint application of 
ten member banks the Federal Re¬ 
serve Board shall order a special ex¬ 
amination and report of the condi¬ 
tion of any Federal reserve bank. 


42 Sec. 24. That no national 

bank shall hereafter make 
any loan or grant any gratuity to 
any examiner of such bank. Any 
bank offending against this provi¬ 
sion shall be deemed guilty of a mis¬ 
demeanor and shall be fined not 
more than $5,000, and a further 
sum equal to the money so loaned 
or gratuity given; and the officer or 
officers of a bank making such loan 
or granting such gratuity shall be 
likewise deemed guilty of a misde¬ 
meanor and each shall be fined not 
to exceed $5,000. 


Any examiner 
accepting a loan or gratuity from 
any bank examined by him shall be 
deemed guilty of a misdemeanor and 
shall be fined not more than $5,000, 
and a further sum equal to the 
money so loaned or gratuity given; 
and shall forever thereafter be dis¬ 
qualified from holding office as a 
national-bank examiner. No na¬ 
tional-bank examiner shall perform 
any other service for compensation 
while holding such office. 


SECTION 24. 


Sec. 444 22. Tbat-no-national No 
member bank or any officer, director, 
or employee thereof shall hereafter 
make any loan or grant any gratuity 
to any examiner of such bank. 
Any bank officer, director, or em¬ 
ployee o ffend ing—against violating 
this provision shall be deemed guilty 
of a misdemeanor and shall be im¬ 
prisoned not exceeding one year or 
fined not more than $5,000, or both; 
and fined a further sum equal to the 
money so loaned or gratuity given-; 

cl 11 vt 

>» roim nf |i| (i' t’lui l i 
r V I cl 11 li 111^ aucTT 



Any examiner accepting a loan or 
gratuity from any bank examined 
by him or from an officer, director, or 
employee thereof shall be deemed 
guilty of a misdemeanor and shall 
be imprisoned not exceeding one year 
or fined not more than $5,000, or 
both; and fined a further sum equal 
to the money so loaned or gratuity 
given; and shall forever thereafter 
be disqualified from holding office 
as a national-bank examiner. No 
national-bank examiner shall per¬ 
form any other service for compen¬ 
sation while holding such office for 
any bank or officer, director, or em¬ 
ployee thereof 


Sec. 24. That no national member 
bank, or any officer, director, or em¬ 
ployee thereof, shall hereafter make 
any loan or grant any gratuity to any 
examiner of such bank. Any bank 
otfending-against officer, director, or 
employee thereof violating this pro¬ 
vision shall be deemed guilty of a 
misdemeanor and shall be im¬ 
prisoned not exceeding one year or 
fined not more than $5,000, and—a 



sball4re-4ikewise-deemed-guilfy^ef-a 
no t t o e x e eed- $5 ; 000 or both. 

Any 

examiner accepting such a loan or 

ky-bim shall be deemed guilty of a 
misdemeanor and shall be im¬ 
prisoned not exceeding one year or be 
fined not more than $5,000, and—a 



loaned-er--^ _ „ 

forever 2 —tbereafter- 
69 qnaiified-feem-boldin g offi ee 
as-a-natlonai-ba nk - ex a m iner 
or both. No national-bank such 
examiner shall perform any other 
service for compensation for a bank 
within his jurisdiction while holding 
such office. 



J i I tt_ 

tlTOvtlj 5 

legitimate f e e -paid-an-attoe- 


mlssion^—gifty—or-otber c o n s i(l eva- 

ttij 


-indi- 

legitbnate—fee—paid-an-atto-rney-at 
giff^-er-t 



rans- 


aefion-w-itb-res^ 
or-otber-invest men t -seeneities-oe 





■ 










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' . 

. 









1 


m 

> 















. 

# 





■ 



COMPARISON OF CURRENCY BILL. 


52 


SE 


HOUSE BILL. 


No officers r director of a national 
bank shall receive or be beneficiary, 
either directly or indirectly, of any 
fee (other than a legitimate fee paid 
an attorney at law for legal serv¬ 
ices), commission, gift, or other 
consideration for or on account of 
any loan, purchase, sale, payment, 
exchange, or transaction with re¬ 
spect to stocks, bonds, or other 
investment securities or notes, bills 
of exchange, acceptances, bankers’ 
bills, cable transfers, or mortgages 
made by or on behalf of a 
43 national bank of which he is 
such officer or director. 


person violating any provision of 
this section shall be punished by a 
fine of not exceeding $5,000 or by 
imprisonment not exceeding five 
years, or both such fine and impris¬ 
onment, in the discretion of the 
court having jurisdiction. 

Except so far as already provided 
in existing laws this provision shall 
not take effect until six months after 
the passage of this Act. 


CTION 24—Continued. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 



Other than the usual salary or di¬ 
rector’s fee paid to any officer, di¬ 
rector, or employee of a member bank 
and other than a reasonable fee paid 
by said bank to such officer, director, 
or employee for services rendered to 
such bank, no officer, director, em¬ 
ployee, or attorney of a member bank 
shall be a beneficiary of or receive, 
directly or indirectly, any fee, com¬ 
mission, gift, or other consideration 
for or in connection with any trans¬ 
action or business of the bank. No 
examiner, public or private, shall dis¬ 
close the names of borrowers or the 
collateral for loans of a member bank 
to other than the proper officers of such 
bank without first having obtained the 
express permission in writing from 
the Comptroller of the Currency, ex¬ 
cept when ordered to do so by a court 
of competent jurisdiction, or by direc¬ 
tion of the Congress of the United 
States,, or either House thereof’, or any 
committee thereof. 


Any person vio¬ 
lating any provision of this section 
shall be punished by a fine of not 
exceeding $5,000 or by imprison¬ 
ment not exceeding fiv e- ye ars 
74 one year, or both' 


dietrem 

Except so far as already provided 
in existing laws this provision shall 
not take effect until six-months sixty 
days after the passage of this Act. 


J C' i x 

arieeSj—bankers 2 —billSj—eable—trans¬ 
fer s-er-mertgages—made- by-er-en 



salary or 
director’s fee paid to any officer, 
director, or employee of a member 
bank: and other than a reasonable fee 
paid to such officer, director, or em¬ 
ployee acting as an attorney at law. 
for legal services rendered to such 
bank, no officer, director, employee, or 
attorney of a member bank shall be a 
beneficiary of or receive, directly or 
indirectly, any fee, commission, gift, 
or other consideration for or in con¬ 
nection with any transaction or 
70 business of the bank:. 


eet 


Other than the usual 


Any 

person violating any provision 
of this section shall be deemed guilty 
of a misdemeanor and punished by 
a fine not exceeding $5,000 or by im¬ 
prisonment not exceeding one year, or 
both. 


Except so far as already provided 
in existing laws this provision shall 
not take effect until six months after 
the passage of this Act. 


Sec. 25. That from and after the 
passage of this Act the stockholders 
of every national banking associa¬ 
tion shall be held individually re¬ 
sponsible for all contracts, cfebts, 
and engagements of such associa¬ 
tion, each to the amount of his 
stock therein, at the par value 
thereof in addition to the amount 
invested in such stock. The stock- 


SECTION 25. 

th e —p assa g e—ef-this-Aet - t he The 
stockholders of every national bank¬ 
ing association shall be held indi¬ 
vidually responsible for all contracts, 
debts, and engagements of such asso¬ 
ciation, each to the amount of his 
stock therein, at the par value 
thereof in addition to the amount 
invested in such stock. The stock- 


Sec. 25. That from and after the 
passage of this Act the stockholders 
of every national banking associa¬ 
tion shall be held individually re- 
sponsiblefor all contracts, debts, and 
engagements of such association, 
each to the amount of his stock 
therein, at the par value thereof in 
addition to the amount invested in 
such stock. The stockholders in 





.. . . . 




■* 




















> , s 



















v 




, 

- 






COMPARISON OF CURRENCY BILL. 


53 


SECTION 25 — Continued. 


HOUSE BILL. 

holders in any national banking 
association who shall have trans¬ 
ferred their shares or registered the 
transfer thereof within sixty days 
next before the date of the failure 
of such association to meet its 
obligations shall be liable to the 
same extent as if they had made no 
such transfer; but this provision 
shall not be construed to affect in 
any wav any recourse which such 
shareholders might otherwise have 
against those in whose names such 
shares are registered at the time of 
such failure. 


Section fifty-one hun¬ 
dred and fifty-one, Revised Statutes 
of the United States, is hereby re¬ 
enacted except in so far as modified 
by this section. 


OWEN AMENDMENT. 

holders in any national banking 
association who shall have trans¬ 
ferred their shares or registered the 
transfer thereof within sixty days 
next before the date of the fadure of 
such association to meet its obliga¬ 
tions, or with knowledge of such im¬ 
pending failure, shall be liable to 
the same extent as if they had 
made no such transfer, to the extent 
that the subsequent transferee fails to 
meet such liability; but this provi¬ 
sion shall not be construed to affect 
in any way any recourse which such 
shareholders might otherwise have 
against those in whose names such 
shares are registered at the time of 
such failure. 



HITCHCOCK AMENDMENT. 

any national banking association 
who shall have transferred their 
shares or registered the transfer 
thereof within sixty days next be¬ 
fore the date of the failure of such 
association to meet its obligations 
shall be liable to the same extent as 
if they had made no such transfer; 
but this provision shall not be con¬ 
strued to affect in any way any re¬ 
course which such shareholders 
might otherwise have against those 
in whose names such shares are 
registered at the time of such failure. 


Section fifty-one hundred and fifty- 
one, Revised Statutes of the United 
States, is hereby reenacted except in 
so far as modified by this section. 


SECTION 26. 


44 


LOANS ON FARM LANDS. 75 LOANS ON FARM LANDS. 


71 LOANS ON FARM LANDS. 


Sec. 26. That any national bank¬ 
ing association not situated in a re¬ 
serve city or central reserve city 
may make loans secured by im- 

C ed and unencumbered farm 
, but no such loan shall be made 
for a longer time than twelve 
months, nor for an amount exceed¬ 
ing fifty per centum of the actual 
value of the property offered as se¬ 
curity, and such property shall be 
situated within the Federal reserve 
district in which the bank is located. 
Any such bank may make such 
loans in an aggregate sum equal to 
twenty-five per centum of its capi¬ 
tal and surplus. 

The Federal Reserve Board shall 
have power from time to time to add 
to the list of cities in which national 
banks shall not be permitted to 
make loans secured upon real estate 
in the manner described in this sec¬ 
tion. 


Sec. ^6 24 . T hat - aiy Any na¬ 
tional banking association not sit¬ 
uated in a reserve city or central 
reserve city may make loans secured 
by improved and unencumbered 
farm land, situated within its Fed¬ 
eral reserve district, but no such loan 
shall be made for a longer time than 
tw olv 0 monfeh s five years, nor for an 
amount exceeding fifty per centum 
of the actual value of the property 
offered as security—and-sueE-prep- 

Federal-rese rv o- di str ict in whieh -the 
b ank is -4eeated. Any such bank 
may make such loans in an aggre¬ 
gate sum ecpial to twenty-five per 
centum of its capital and surplus. 

The Federal Reserve Board shall 
have power from time to time to add 
to the list of cities in which national 
banks shall not be permitted to 
make loans secured upon real estate 
in the manner described in this 
section. 


The Hitchcock amendment proposes to 
strike out all of setion 26 of the House bill 
and insert the following: 

Sec. 26 . That deposits in national 
banks, payable more than thirty days 
after they are made, shall be known as 
time deposits, and such banks may 
continue hereafter as heretofore to re¬ 
ceive time deposits and to pay interest 
on the same. All national banks, not 
located in central reserve cities, may 
make loans, secured by improved, oc¬ 
cupied, and unencumbered farm land 
situated within the Federal reserve 
district where the loaning bank is lo¬ 
cated to the extent of one-half of its 
value, but no such loan shall be made 
for a longer period than five years, 
nor shall the aggregate of such loans 
by any bank exceed one-third of its 
time deposits. 

72 After becoming member 

banks of any reserve bank, 
national banks are hereby authorized 
or act as administrators, executors, 
to trustees. 















. . J 1 

I' ■ ■ ' 


■ 










■ ■■ ' - ' .1 












. 










■ 

■bin 







' n ' ! . • • •• -- ' i '■■■■ •• .. 






■ 

. 





54 


COMPARISON OF CURRENCY BILL. 

SECTION 27. 

Both the Owen and Hitchcock amendments propose to eliminate this section entirely 

HOUSE BILL. 

SAYINGS DEPARTMENT. 

Sec. 27 . That any national banking association may, subsequent to a date one year after the organization 
of the Federal Reserve Board, make application to the Comptroller of the Currency for permission to open a 
savings department. Such- application shall set forth that the directors of said national bank have by a ma¬ 
jority vote apportioned a specified percentage of their paid-in capital and surplus to said savmgs de- 

45 partment and to that end have segregated specified assets for the uses of said department, or that cash 
capital for the said savings department has been obtained by subscription to additional issues of the 

capital stock of said national bank: Provided, That the capital thus set apart for the uses of the proposed sav¬ 
ings department aforesaid shall in no case be less than $15,000, or than a sum equal to twenty per centum of 
the paid-up capital and surplus of the said national bank. 

In making the application aforesaid any national banking association may further apply for power to 
act as trustee for mortgage loans subject to the conditions and limitations herein prescribed or to be estab¬ 
lished as hereinafter provided. 

Whenever the Comptroller of the Currency shall have approved any such application as hereinbefore pro¬ 
vided, he shall so inform the applying bank, and thereafter it shall be authorized to receive savings deposits 
as so defined, and the organization and business conducted or possessed by said bank at the time of making 
said application, except such as has been specifically segregated, for the savings department, and subsequent 
expansions thereof shall be known as the commercial department of the said bank. The said departments 
shall, to all intents and purposes, be separate and distinct institutions save and except 

46 as hereinafter expressly provided. The capital, surplus, deposits, securities, investments, and other 
property, effects, and assets of each of said departments shall, in no event, be mingled with those 

of the other department, or used, either in whole or in part, to pay any of the deposits of the other department 
until all of the deposits of its own department have been fully paid and satisfied. National banks may in¬ 
crease or diminish their capital stock in the manner now provided by law, but whenever such general increase 
or reduction of the capital stock of any national bank operating upon the provisions of this section shall be 
made such increase or reduction shall be apportioned between the commercial and savings departments of the 
said bank as its board of directors shall prescribe, notice of such increase or reduction, and of the apportionment 
thereof, being forthwith given to the Comptroller of the Currency; and any such national bank may increase 
or diminish the capital already apportioned to either its savings or commercual department to an extent not 
inconsistent with the provisions of this section, notifying the Comptroller of the Currency as hereinbefore pro¬ 
vided. The savings department for which authority has been solicited and granted shall have control of the 
cash or assets apportioned to it as hereinbefore provided, and shall be organized under rules and regulations 
to be prescribed by the Comptroller of the Currency. 

47 Both the savings and commercial departments so created shall, however, be under the control and 
direction of a single board of directors and of the general officers of said bank. 

All business transacted by the commercial department of any such national bank shall be in every respect 
subject to the limitations and requirements provided in the national banking Act as modified by this Act, 
and such business shall henceforward be known as commercial business. 

The savings department of each such national bank shall be authorized to accumulate and loan the funds 
of its depositors, to receive deposits of current funds, to purchase securities authorized by the Federal Reserve 
Board, to loan any funds in its possession upon real estate or other authorized security, and to collect the same 
with interest, and to declare and pay dividends or interest upon its deposits. The Federal Reserve Board is 
hereby authorized to exempt the savings departments of national banking associations from any and 'every 
restriction upon classes or kinds of business laid down in the national banking Act, and it shall be the duty 
of the said board within one year after its organization to prepare and publish rules and regulations for the 
conduct of business by such savings departments. The said regulations shall require every national 

48 bank which shall conduct a savings department and a commercial department to segregate in its own 
vaults the cash and assets belonging to such departments respectively and shall prescribe the general 

forms of separate books of account to be used by each such department for its exclusive and individual use. 
The regulations aforesaid shall further specify the period of notice for the withdrawal of deposits made in the said 
savings department and shall forbid the acceptance of deposits by one department of such national bank from 
the other department of such bank. The Federal Reserve Board shall make and publish at its discretion lists 
of securities, paper, bonds, and other forms of investment, which the savings departments of national banks 
shall be authorized to buy or loan upon; and said lists need not be uniform throughout the United States, but 
shall be adapted to the conditions of business in different sections of the country. 

It shall be the duty of every national bank to maintain, with respect to all deposit liabilities of its savmgs 
department, a reserve in money which may under existing law be counted as reserve, equal to not less than five 
per centum of the total deposit liabilities of such department, and every national bank authorized to 

49 maintain a savings department is hereby exempted from the reserve requirements of the national banking 
Act and of this Act in respect to the said deposit liabilities of its savings department, except as in this 

section provided. Every regulation made in pursuance of this section shall be duly published, and also posted 
in everv member bank having a savings department. „ . , , , 

Every officer, director, or employee of any member bank who shall knowingly or willfully violate anv of 
the provisions of this section, or any of the regulations of the Federal Reserve Board, or of the Comptroller 
of the Currency made under and by virtue of the provisions of this section shall be guilty of a felony, and on 
conviction thereof shall be punished by a fine not exceeding $5,000 or by imprisonment not exceeding two 
years, or both, in the discretion of the court. 

















. 








' 

' 

. 





' 



























. 

■ 


































COMPARISON OF CURRENCY BILL. 

SECTION 28. 


55 


HOUSE BILL. 


OWEN AMENDMENT. 


HITCHCOCK AMENDMENT. 


FOREIGN BRANCHES. 


FOREIGN BRANCHES. 


FOREIGN BRANCHES. 


Sec. 28. That any national bank¬ 
ing association possessing a capital 
of $1,000,000 or more may file appli¬ 
cation with the Federal Reserve 
Board, upon such conditions and 
under such circumstances as may be 
prescribed by the said board, for the 
purpose of securing authority to es¬ 
tablish branches in foreign countries 
for the furtherance of the foreign 
commerce of the United States and 
to act, if required to do so, as fiscal 
agents of the United States. Such 
application shall specify, in addi¬ 
tion to the name and capital 
50 of the banking association 
filing it, the foreign country 
or countries or the dependencies of 
the United States where the banking 
operations proposed are to be car¬ 
ried on and the amount of capital 
set aside by the said banking associ¬ 
ation filing such application for the 
conduct of its foreign business at 
the branches proposed by it to be 
established in foreign countries. 
The Federal Reserve Board shall 
have power to approve or to reject 
such application, if in its judgment, 
the amount of capital proposed to 
be set aside for the conduct of for¬ 
eign business is inadequate or if for 
other reasons the granting of such 
application is deemed inexpedient. 


Every national banking associa¬ 
tion which shall receive authority 
to establish branches in foreign 
countries shall be required at all 
times to furnish information con¬ 
cerning the condition of such 
branches to the Comptroller of the 
Currency upon demand, and the 
Federal Reserve Board may order 
special examinations of the said 
foreign branches at such time or 
times as it may deem best. Every 
such national banking association 
shall conduct the accounts of each 
foreign branch independently of the 
accounts of other foreign branches 
established by it and of its home 
office, and shall at the end of each 
fiscal period transfer to its general 
ledger the profit or loss accruing at 
each such branch as a separate 
item. 


Sec. 38 25. That Any national 
banking association possessing a 
capital and surplus of $1,000,000 or 
more may file application with the 
Federal Reserve Board, upon such 
conditions and under such eireu m 
stanees regulations as may be pre¬ 
scribed by the said board, for the 
purpose of securing authority to 
establish branches in foreign coun¬ 
tries or dependencies of the United 
States for the furtherance of the 
foreign commerce of the United 
States and to act, if required to do 
so, as fiscal agents of the United 
States. Such application shall 
specify, in addition to the name and 
capital of the banking association 
filing it, ’ 


81 of—the—United—States place 

or places where the banking 
operations proposed are to be car¬ 
ried on and the amount of capital 
set aside by the said banking asso¬ 
ciation filing such application for 
the conduct of its foreign business 
at the branches proposed by it to 
be established in foreign-countries 
such place or places. The Federal 
Reserve Board shall have power to 
approve or to reject such applica¬ 
tion if, in its judgment, the amount 
of capital proposed to be set aside 
for the conduct of foreign business 
is inadequate or if for other reasons 
the granting of such application is 
deemed inexpedient. 

Every national banking associa¬ 
tion which shall receive authority 
to establish foreign branches in fer- 
ign—eenntries shall be required at 
all times to furnish information 
concerning the condition of such 
branches to the Comptroller of the 
Currency upon demand, and the 
Federal Reserve Board may order 
special examinations of the said 
foreign branches at such time or 
times as it may deem best. Every 
such national banking association 
shall conduct the accounts of each 
foreign branch independently of the 
accounts of other foreign branches 
established by it and of its home 
office, and shall at the end of each 
fiscal period transfer to its general 
ledger the profit or loss accruing at 
each sueh branch as a separate 
item. 


Sec. 38 27. That any Federal reserve 
bank or national banking association 
possessing a capital of 81^)00^)00 
$5,000,000 or more may file appli¬ 
cation with the Federal Reserve 


Board, upon such conditions and 
under such circumstances as may be 
prescribed by the said board, for the 
purpose of securing authority to es¬ 
tablish branches in foreign countries 
or dependencies of the United 
77 States for the furtherance of 
the foreign commerce of the 
United States and to act, if re¬ 
quired to do so, as fiscal agents of the 
United States. Such applications 
shall specify, in addition to the name 
and capital of the banking associa¬ 
tion filing it, the •' 


place or places where 
the banking operations proposed are 
to be carried on and the amount of 
capital set aside by the said banking 
association filing such application 
for the conduct of its foreign busi¬ 
ness at the branches proposed by it 
to be established in foreign coun¬ 
tries. The Federal Reserve Board 
shall have power to approve or to 
reject such application if, in its 
judgment, the amount of capital 
proposed to be set aside for the con¬ 
duct of foreign business is inade¬ 
quate or if for other reasons the 
granting of such application is 
deemed inexpedient. 


Every national banking associa¬ 
tion which shall receive authority 
to establish branches in foreign 
countries shall be required at all 
times to furnish information con¬ 
cerning the condition of such 
branches to the Comptroller of the 
Currency upon demand, and the 
Federal Reserve Board may order 
special examinations of the said for¬ 
eign branches at such time or times 
as it may deem best. Every Fed¬ 
eral reserve bank and every such na¬ 
tional banking association shall 
conduct the accounts of each foreign 
branch independently of the ac¬ 
counts of other foreign branches es¬ 
tablished by it and of its home 
office, and shall at the end 
78 of each fiscal period trans¬ 
fer to its general ledger the 
profit or loss accruing at each such 
branch as a separate item. 
















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COMPARISON OF CURRENCY BILL. 


56 


HOUSE BILL. 

§1 Sec. 29. That all provisions 

of law inconsistent with or 
superseded by any of the provisions 
of this Act be, and the same are 
hereby, repealed: Provided, That 
nothing in this Act contained shall 
be construed to repeal the parity 
provision or provisions contained 
m an Act approved March four¬ 
teenth, nineteen hundred, entitled 
“An Act to *define and fix the 
standard of value, to maintain the 
parity of all forms of money issued 
or coined by the United States, to 
refund the public debt, and for 
other purposes.” 


SECTION 29. 

OWEN AMENDMENT. 

82 Sec. 26. Tha t—aH All 

provisions of law inconsist¬ 
ent with or superseded by any of 
the provisions of this Act be^-and 
t he - sa m e - a re are to that extent and. 
to that extent only hereby^- repealed-; 
Provided,- - Th at —n othing. Nothing 
in this Act contained shall be con¬ 
strued to repeal the parity provi¬ 
sion or provisions contained in an 
Act approved March fourteenth, 
nineteen hundred, entitled “An Act 
to define and fix the standard of 
value, to maintain the parity of all 
forms of money issued or corned by 
the United States, to refund the 
public debt, and for other pur¬ 
poses,” and the Secretary of the 
Treasury may for such purposes, or 
to strengthen the gold reserve, borrow 
gold on the security of United States 
bonds or for one-year notes bearing 
interest at a rate of not to exceed 
three per centum per annum, or sell 
the same if necessary to obtain gold. 
When the funds of the Treasury on 
hand justify, he may purchase and 
retire such outstanding bonds and 
notes. 


HITCHCOCK AMENDMENT. 

of law inconsistent with or super¬ 
seded by any of the provisions of 
this Act be, and the s a m e- a re are to 
that extent and to that extent only 
hereby repealed: Provided, That 
nothing in this Act contained shall 
be construed to repeal the parity 
provision or provisions contained in 
an Act approved March fourteenth, 
nineteen hundred, entitled, “An Act 
to define and fix the standard of 
value, to maintain the parity of all 
forms of money issued or coined by 
the United States, to refund the 
public debt, and for other purposes.” 












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COMPARISON OF CURRENCY BILL. 


57 


HOUSE BILL. 


Sec. 30. That the right to amend, 
alter, or repeal this Act is hereby 
expressly reserved. 

Passed the House of Represent¬ 
atives September 18, 1913. 

Attest: 

SOUTH TRIMBLE, 

Cleric. 

20622—S. Doc. 264, 63-2-8 




NEW SECTIONS. 

OWEN AMENDMENT. 

Sec. 27. The provisions of the Act 
of May thirtieth, nineteen hundred 
and eight, authorizing national cur¬ 
rency associations, the issue of addi¬ 
tional nationalr-banlc circulation, and 
creating a National Monetary Cora- 
mission, which expires by limitation 
under the terms of such Act on the 
thirtieth day of June, nineteen hun¬ 
dred and fourteen, are hereby extended 
to June thirtieth, nineteen hundred 
and fifteen, and sections fifty-one 
hundred and fifty-three, fifty - 
83 one hundred and seventy-two, 
■fifty-one hundred and ninety- 
one, and fifty-two hundred and four¬ 
teen of the Revised Statutes of the 
United States, which were amended 
by the Act of May twentieth, nineteen 
hundred and eight, are hereby r re¬ 
enacted to read as such sections read 
prior to May twentieth, '*nineteen 
hundred and eight, subject to such 
amendments or modifications as are 
prescribed in this Act. 

Sec. 28. If any clause, sentence, 
paragraph, or part of this Act shall 
for any reason be adjudged by any 
court of competent jurisdiction to be 
invalid, such judgment shall not 
affect, impair, or invalidate the re¬ 
mainder of this Act, but shall be con¬ 
fined in its operation to the clause, 
sentence, paragraph, or part thereof 
directly involved in the controversy in 
which such judgment shall have been 
rendered. 


SECTION 30. 

Sec. 30 29. That the The right 
to amend, alter, or repeal this Act 
is hereby expressly reserved. 


o 


HITCHCOCK AMENDMENT. 

Sec. 29. That the provisions of 
the Act of May thirtieth, nineteen 
hundred and eight, authorizing na¬ 
tional currency associations, the issue 
of additional national-banlc circula¬ 
tion, and creating a National Mone¬ 
tary Commission, which expires by 
limitation under the terms of such 
Act on the thirtieth day of June, nine¬ 
teen hundred and fourteen, are hereby 
extended to June thirtieth, nineteen 
hundred and fifteen. 


Sec. 30. That the right to amend, 
alter, or repeal this Act is hereby ex¬ 
pressly reserved. 


































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